7 Bad Money Habits Killing Your Finances (and how to recover)

Bad money habits are behaviors that quietly drain your wealth and keep you from reaching your financial goals. In this post, we'll uncover seven common habits that might sabotage your finances and show you how to break free from them.

1. Impulsive spending

Impulsive spending is one of the most common habits that can wreck your finances without realizing it. Those small, seemingly harmless purchases add up over time and leave you wondering where all your money went.

Signs to look for:

Watch for these red flags:

• Frequent unplanned purchases
• Purchases driven by emotions, not necessity
• Difficulty recalling recent purchases
• Accumulating items you rarely use
• Growing credit card balances
• Buyer’s remorse

Look at Steve and Taylor, a couple living in New York City, find themselves at a financial crossroads. Steve lost his job a while back and hasn’t taken his career seriously, while Taylor has taken on much of the financial responsibility and is considering buying a house.

Unfortunately, Steve has some impulsive spending red flags. He spends an excessive amount of time chasing deals and accumulating points just for the thrill of “getting a good deal”.

[00:09:43] Steve: I love getting a good deal. It’s true.

[00:09:48] Ramit: You always loved that your whole life?

[00:09:50] Steve: Yeah, I think so. Yeah. Even when I was in my teens, I would order the Columbia House CDs and then sell them individually to people. But I definitely think I get caught up in the granular deal stuff too much for sure. And this has been my thought, but also pointed out by Taylor.

[00:10:10] Ramit: We’re talking credit card points, miles, that kind of thing?

[00:10:12] Steve: Yeah.

[00:10:12] Ramit: All right. Would you end up on the subreddits and stuff like that?

[00:10:14] Steve: Yeah, but even before then I was like, the various forms even before all those churning forms, etc. Random ones.

[00:10:24] Ramit: Like what? Deals?

[00:10:26] Steve: Yeah, I don’t even remember it now, at this point. It’s just random miles.

[00:10:29] Ramit: What do you love about miles?

[00:10:32] Steve: I do love to travel, so I love being able to travel for free. We go on multiple vacations a year for free. We’re going on one in two weeks.

[00:10:42] Ramit: You’re going to France, right?

[00:10:42] Steve: France, yeah.

[00:10:43] Taylor: We’re leave tomorrow.

[00:10:44] Ramit: How long are you going for?

[00:10:45] Steve: Two and a half weeks.

[00:10:46] Ramit: Whoa. Really? Where are you going to go in France?

[00:10:50] Steve: We’re going to the Loire Valley, and then Paris, and then Lyon for Taylor Swift, and then Provence where we met a magical car last year at a firm. I want to see that car again.

Steve shows signs of impulsive spending, but his income doesn’t match his habits. Instead of steady earnings, he's relying on savings and stocks just to get by, and he owes Taylor over $20,000 from accumulated expenses. Meanwhile, Taylor is in a completely different place financially—she’s ready to buy a house and is frustrated with Steve’s spending and lack of contribution.

[00:46:56] Steve: The fact that I’m not earning enough right now to really save or be able to contribute to a mortgage. So it was stressful just because we have all our money issues in general that got brought up during it.

[00:47:11] Ramit: Okay. So you guys are at 61% fixed cost. By the way, just look at these numbers here. Partner 1, that’s you, Taylor, you’re paying 42% of your income towards fixed costs. Partner 2, that’s you, Steve, you’re paying 138% of your income towards fixed costs. What do y’all make of that?

[00:47:31] Steve: It’s not been a good year for me, yeah.

[00:47:33] Ramit: Mm-hmm.

[00:47:35] Taylor: I don’t know where he’s getting 138% from.

[00:47:38] Ramit: I’ll tell you right now. We took all this stuff and divided it by his income. All this adds up to more than 3,000 bucks. Yeah, more than $2,000, his net.

[00:47:52] Taylor: Right.

[00:47:52] Steve: Okay, got it.

[00:47:52] Taylor: But how is he paying it? I guess from savings and–

[00:47:57] Ramit: Stocks.

[00:47:57] Taylor: Stocks, yeah. We have a split wise where he owes me money too.

[00:48:03] Ramit: Haven’t you guys been married for almost 10 years?

[00:48:05] Taylor: We’ve been together for almost 10 years, but I feel like I need to, for some reason, stay strict with that because if I just let this 22,000 go that he owes me, I feel like I’m just doing the cushion where he doesn’t really have to try and is just coasting.

[00:48:25] Ramit: What’s this 22,000 that he owes you? Why?

[00:48:27] Taylor: A lot of it was from our wedding because we opened up cards that we put points on.

[00:48:32] Ramit: What else?

[00:48:33] Taylor: Random stuff that just accumulates.

[00:48:35] Ramit: All right, so he owes you $22,000, owes. You said you’re “strict” about it? So I use quotes, but maybe you’re like no, I actually want that money. You tell me.

[00:48:46] Taylor: I do want it.

[00:48:47] Ramit: Okay.

[00:48:48] Taylor: Especially if I want to get a house, that would go towards things.

[00:48:51] Ramit: All right. What do you think about that, Steve?

[00:48:53] Steve: I think that’s totally fair.

[00:48:55] Ramit: Why don’t you just take some of that money out of your portfolio?

[00:48:57] Steve: I should. It’s so hard for me to sell.

Steve’s ongoing avoidance of financial responsibility adds to the strain on their relationship. Unless he addresses his impulsive spending and starts actively contributing, Taylor's goal of building a secure financial future will remain out of reach.

Why it’s a bad habit:

Impulsive spending doesn’t just drain your bank account — it impacts every aspect of your life. It creates constant financial stress and anxiety, as you're always worried about your money situation and whether you have enough to cover your needs. It can also clutter your living space with items you don’t use, making you feel overwhelmed and disorganized. With money tied up in things you don’t need, there’s less left for what truly matters — traveling, investing, or saving for a big goal.

This habit can quickly derail your budget and savings goals. A few unplanned purchases can easily add up, making sticking to your financial plan challenging. Impulsive spending can also strain relationships, as disagreements over money are one of the leading causes of conflict. Worst of all, it leaves you unable to pay for important things when unexpected expenses arise.

How to break the habit

Breaking the cycle of impulsive spending requires a mix of practical strategies and mindset shifts. Here are some effective steps to help you regain control over your finances:

• Implement a 24-hour rule for non-essential purchases: Before buying something impulsively, wait 24 hours to see if you still want or need it.
• Unsubscribe from retailer emails and unfollow brands on social media: Reduce exposure to tempting sales and promotions that trigger impulse buys.
• Use cash or a debit card for discretionary spending: Paying with cash or a debit card makes you more aware of your spending and helps you stay within your limits.
• Create a "fun money" budget for guilt-free spending: Set aside a specific amount each month for non-essential purchases so you can enjoy spending without overdoing it.
• Figure out your Money Dials: Reflect on your priorities and decide which areas of spending bring you the most happiness — travel, health, convenience, or something else. Align spending with these values to avoid wasting money on things that don’t bring you joy.

With Money Dials, you give yourself permission to enjoy what you love without guilt while avoiding wasteful purchases that don’t align with your values. Combining these strategies helps you break free from impulsive spending and ensures your money works for you, supporting your financial goals and your happiness.

2. Living from paycheck to paycheck

Living from paycheck to paycheck is a cycle that can feel impossible to break. It's when you're constantly waiting for your next paycheck to cover your basic expenses, leaving little to no room for savings or unexpected costs.

In fact, a recent survey found that over 60% of Americans live paycheck to paycheck, regardless of income level.

Signs to look for:

Here are some signs you might be stuck in this cycle:

• Bank account balance near zero before your next paycheck
• Regularly using credit cards to cover basic expenses
• Unable to save even small amounts consistently
• Anxiety about unexpected expenses

Why it’s a bad habit:

Living paycheck to paycheck leaves no financial buffer between income and expenses. This creates high stress and makes you vulnerable to financial emergencies. It’s hard to build long-term wealth or save for goals like buying a home or starting a business when every dollar is already spoken for.

Constant worry about bills can cause sleepless nights and strain relationships, limiting your ability to make career changes or take educational opportunities that could improve your financial situation.

How to stop living paycheck to paycheck:

To break free from this cycle, start with these actionable steps:

• Create a detailed budget to understand your income, expenses, and saving goals.
• Look for areas to cut spending, even if it's just temporarily.
• Increase your income through side hustles or by asking for a raise.
• Build an emergency fund, starting with a small goal (e.g., $500).

Escaping the paycheck-to-paycheck cycle isn't easy, but small, consistent changes can make a big difference.

3. Neglecting an emergency fund

Neglecting to build an emergency fund is a common mistake that can expose you to financial risks. Without a safety net, you’re left scrambling when unexpected expenses pop up.

Signs to look for:

Here are some signs that you might be neglecting an emergency fund:

• No dedicated savings for emergencies
• Using credit cards or loans to cover unexpected expenses
• Feeling stressed about potential car repairs, medical bills, etc.
• Frequently borrowing from friends or family

Why it’s a bad habit:

Not having an emergency fund means you lack a financial safety net for unexpected expenses or income loss. This can force you to rely on high-interest debt, like credit cards or loans, during emergencies, perpetuating a cycle of financial insecurity.

Even minor setbacks, like a broken appliance or medical bill, can quickly escalate into major crises without an emergency cushion. Plus, without a fund, you miss out on opportunities that require upfront cash — whether investing in a new skill, taking a trip, or buying something essential at a great price.

How to break the habit:

Building an emergency fund doesn’t have to be overwhelming. Start with these steps:

• Start small, aiming for $500-$1000 initially. Even a modest goal can provide a cushion for minor emergencies.
• Set up automatic transfers to a separate savings account. Tools like sub-savings accounts help keep your emergency fund separate and less tempting to dip into.
• Use windfalls like tax refunds or bonuses to jumpstart your fund. Instead of spending unexpected money, save it for future emergencies.
• Aim for 3-6 months of living expenses as a long-term goal. Once you’ve hit your initial target, build your fund to cover bigger emergencies.

An emergency fund gives you peace of mind and stability, allowing you to handle life's surprises without derailing your financial progress.

Need more help saving?

These three strategies will show you how to save an extra $1,000 a month, making it easier to build your emergency fund faster.

4. Maxing out credit cards

Maxing out your credit cards is a dangerous habit that can trap you in a cycle of debt and damage your financial future.

The average American household without a mortgage carries $132,529 in debt, including credit cards, auto loans, student loans, and medical debt. With the average credit card balance alone at $16,061, it's easy to see how quickly debt can spiral out of control.

Signs to look for:

Recognizing the signs of having maxed out credit cards is the first step toward breaking free from them. Here are some common indicators:

• Carrying a balance month to month
• Making only minimum payments
• Using credit cards for everyday expenses without paying in full
• Frequently opening new cards to transfer balances
• Getting declined for new credit
• Using credit to pay for bills and necessities regularly

See Ashley and Brandon’s story to learn how maxing out credit cards can quickly spiral out of control. After using a debt consolidation loan to pay off their balances, they fell into old habits and maxed out their cards again, accumulating over $100,000 in debt.

[00:02:13]   Ashley: We did a debt consolidation loan, paid off our credit cards, and then maxed out our credit cards again, I mean, every single one of them– over $100, 000.

[00:02:29]   Brandon: I guess there is things I just don’t know.

[00:02:32] Ashley:  I don’t want him to feel unworthy.

[00:02:40] Brandon:   We’ve always had this, like, oh, we’re going to make more money, and then it’s going to be better. And it’s not.

[00:02:58] Ashley:  He can’t haul a snowmobile without the truck. He can’t haul his four-wheeler without the truck.

[00:03:04]   Ramit: Is this a joke?

[00:03:06] Ashley:  No.

[00:03:06] Ramit:   What other toys are hiding in there?

[00:03:09] Brandon:  House, snowmobile, four-wheeler, pit bike, car, a riding lawnmower, push mower, a camper.

[00:03:14] Ramit: And soon they have an important decision to make about their family one where money will play a central role.

Despite their mounting debt, Ashley is determined to pay it off aggressively, while Brandon prefers to make only the minimum payments to maintain their lifestyle. This tension reveals the difficulty of managing debt when one partner prioritizes immediate enjoyment over long-term financial stability.

[00:07:42] Ramit: So the primary challenge that you’re both facing is you have debt, and you disagree about how aggressively to pay it off. Is that right?

[00:07:52] Brandon: Yeah.

[00:07:53] Ramit: All right, Ashley, you want to pay it off what?

[00:07:55] Ashley: As aggressively as possible. So right now we’re paying way over what our minimum payments are to try and get especially the credit card debt paid off as soon as we can. That’s been my main focus because the interest rate is so high. And then after that, I have kind debt payoff schedule that’s snowballing all of the payments.

[00:08:23] Ramit: Okay. And Brandon?

[00:08:25] Brandon: I was more of minimum payments just so we weren’t strapped.

[00:08:30] Ramit: Okay. Do you know how much you spend per year?

[00:08:34] Brandon: I don’t know.

[00:08:35] Ashley: I think we spend more than we need to, so I know that we could be putting more towards it. But I know that Brandon has expressed not wanting to stop living and stop having some of the luxuries of life to pay off the debt that we’ve accumulated.

[00:08:58] Ramit: Mm-hmm.

[00:09:00] Ashley: So I’m trying to find some balance between those two things.

[00:09:04] Ramit: Okay. Why are you the one finding the balance, Ashley, out of curiosity?

[00:09:10] Ashley: He doesn’t really have or doesn’t seem to have any interest in figuring out the financial piece of it.

[00:09:18] Ramit: Does that concern you?

[00:09:20] Ashley: It frustrates me. It feels like it’s all on my shoulder sometimes to figure out how we’re getting out of the debt or when, because things weren’t always what they are right now, like salary wise or whatever. But when we have been in a worse situation, I was always the one figuring out where rent was coming from or how we’re paying the mortgage. And now I’m the one figuring out how we’re going to pay off our debt and he just wants to be able to spend the money.

Ashley and Brandon's situation underscores the dangers of relying on credit cards and not aligning on a debt repayment strategy. Without a clear plan and mutual commitment to change, their debt will continue to grow, preventing them from achieving their Rich Life.

Why it’s a bad habit:

Maxing out credit cards leads to the accumulation of high-interest debt, which means you end up paying significantly more for your purchases over time. It can also cause potential damage to your credit score, making it harder to borrow for major life purchases, like a home or car, and may even limit job opportunities if employers check your credit history.

In extreme cases, you might spend years paying off items that have long lost their usefulness or value. If you’ve found yourself with a credit card problem and are ready to tackle those payments, try out my debt payment calculator. All you have to do is enter your current balance, interest rate, and monthly payment amount, and it will show you how long it will take to pay off your debt.

Current Balance Owed ($) *Yearly Interest Rate (%) *Monthly Payment ($) *How much you plan to pay back every monthHow many months it'll take to pay off your loan:
Submit

How to break the habit:

To break the cycle of maxing out credit cards, consider these steps:

• Switch to cash or a debit card for daily expenses to prevent further debt accumulation.
• Create a debt repayment plan using strategies like the debt avalanche or snowball method to pay down your balances efficiently.
• Cut up your cards or freeze them in a block of ice for emergencies only. This makes them harder to access and use impulsively.
• Negotiate lower interest rates with your creditors to reduce the cost of your debt. Use a simple script to ask for a better rate.

If you’re not sure how to start the conversation, don’t worry — here’s a simple word-for-word script to negotiate better interest rates successfully which you can use for FREE.

YOU: “Hi, I’m going to be paying off my credit card debt more aggressively beginning next week, and I’d like to lower my credit card’s interest rate.”

CC REP: “Uh, why?”

YOU: “I’ve decided to be more aggressive about paying off my debt, and that’s why I’d like to lower the interest rate I’m paying. Other cards are offering me rates at half what you’re offering. Can you lower my rate by 50% or only 40%?”

CC REP: “Hmmm … After reviewing your account, I’m afraid we can’t offer you a lower interest rate.”

YOU: “As I mentioned before, other credit cards are offering me 0% introductory rates for 12 months, as well as APRs that are half what you’re offering. I’ve been a customer for XX years and I’d prefer not to switch my balance over to a lower-interest card. Can you match the other credit card rates, or can you at least go any lower?”

CC REP: “I see … Hmm, let me pull something up here. Fortunately, the system is suddenly letting me offer you a reduced APR. That is effective immediately.”

5. Ignoring retirement savings

Ignoring your retirement savings can set you up for a financially insecure future. Many people push off retirement planning because it feels distant or overwhelming, but neglecting it now can have significant consequences later.

Signs to look for:

Here are some signs that you might be ignoring your retirement savings:

• Not contributing to a 401(k) or IRA
• Leaving employer match on the table
• No clear idea of how much you need for retirement
• Prioritizing short-term wants over long-term needs

Why it’s a bad habit:

Failing to save for retirement means you risk having insufficient funds for a comfortable lifestyle in your later years. You miss out on the benefits of compound interest and any employer matches that could boost your savings. As a result, you may face increased financial stress later in life, potentially forcing you to work well past your desired retirement age. This lack of preparation can reduce your quality of life and even place an increased financial burden on your family members.

How to break the habit:

To stop ignoring your retirement savings and start preparing for the future, take these steps:

• Start contributing to retirement accounts, even small amounts. Consistency is key, and even small contributions can grow significantly over time due to compound interest.
• Take full advantage of employer matches. If your employer offers a matching contribution to your 401(k), make sure you’re contributing enough to get the full match — it's essentially free money.
• Increase contributions with each raise or bonus. Automatically allocate a portion of any increase in income to your retirement savings to keep growing your nest egg without feeling the pinch.
• Educate yourself on investment options and asset allocation. Understanding where your money is going and how it can grow will help you make informed decisions that maximize your retirement savings.

Prioritizing your retirement savings will reduce financial stress later and allow you to enjoy a higher quality of life in your golden years.

6. Spending for social status

Spending to keep up appearances can be a financial trap that leaves you feeling unfulfilled and stressed. It’s easy to fall into the habit of buying things to impress others or match someone else’s lifestyle, but this approach can do more harm than good.

Signs to look for:

Here are some signs that you might be spending for social status:

• Buying luxury items you can't afford
• Feeling envious of friends' possessions or lifestyles
• Hiding purchases or financial struggles from loved ones
• Prioritizing image over financial stability
• Spending beyond your means to maintain appearances
• Neglecting personal financial goals for social status

Kevin and Michelle, a couple in their 30s, find themselves trapped in a cycle of debt despite earning a good income. Their spending habits, particularly on frequent vacations, reflect a desire to maintain a certain lifestyle and keep up appearances. Kevin admits feeling conflicted about the need for constant trips, while Michelle often justifies their expenses by finding a “great deal,” even though the total costs quickly add up.

[00:38:09] Ramit: What’s the thing about vacations you mentioned Kevin?

[00:38:12] Kevin: I feel like Michelle loves taking vacations. It’ll be a weekend thing. It’ll be a one-week thing. And I get it. I love to travel. We both love to travel, so yes, we want to explore the world and do all these things. And she’s like, well, we can afford to do it, so why not? We should do it.

[00:38:36] Ramit: Where was the last place you went?

[00:38:38] Kevin: Austin. Was it Austin?

[00:38:42] Michelle: Bahamas.

[00:38:42] Kevin: No, Bahamas.

[00:38:44] Ramit: That’s nice.

[00:38:45] Kevin: But after that, she was just on the cruise that she just went on with her mom and Enzo.

[00:38:50] Ramit: When she suggests these vacation spots, how does it make you feel, Kevin?

[00:38:53] Kevin: My first reactions is like, I don’t think it’s necessary. Then obviously, I enjoy it. I have a great time. Who wouldn’t? But I’m hesitant. I’m really actually hesitant because I don’t feel like it’s necessary in that moment, or I don’t feel like it’s the right time because there’s been situations where we took these vacations and I had to take off from work, so now I’m missing out on money that I could be making. And a lot of the times I’ve expressed that to her. I got to cancel coaching. I got to do this and stuff and move things around.

[00:39:22] Ramit: How did she respond?

[00:39:24] Kevin: We’ll figure it out.

[00:39:25] Michelle: Yeah. I feel like where he may overspend with the little things, it is my biggest problem, feeling the need to go on vacation because I see a cheap flight, and I’m like, oh, well look, I’m going to buy this cheap flight. But then of course comes other costs, like the hotel might not be as cheap, and then of course the food and whatever else comes with it. So I think I get lured in by that, small, like, oh my gosh, the flight’s $80. We have to go. But it’s not $80.

[00:39:57] Ramit: In total, how many vacations do you take a year?

[00:40:02] Michelle: Maybe three.

[00:40:06] Ramit: Okay. Round up.

[00:40:07] Kevin: Last year we took about 10.

Their story is a perfect example of how spending to project an image or sustain a luxury lifestyle can create financial strain and interpersonal tension, emphasizing the importance of setting boundaries and aligning financial goals. Without addressing these habits, they risk continuing the cycle of debt and undermining their long-term financial security.

Why it’s a bad habit:

Spending for social status often leads to chronic dissatisfaction and feelings of inadequacy, as you constantly try to measure up to others. Financial comparisons can strain friendships and relationships when they become a source of tension. By prioritizing appearances over your personal values and authentic desires, you risk accumulating debt and increasing stress levels. This behavior can also create relationship stress as your financial struggles become harder to hide.

How to break the habit:

To shift away from spending for social status, try these strategies:

• Practice gratitude for what you already have. Focus on the things that genuinely bring you happiness and fulfillment rather than what others have.
• Unfollow social media accounts that trigger comparison. Limit exposure to content that makes you feel like you need to spend more to keep up.
• Set personal financial goals and track your progress. Having clear, meaningful goals can help you stay focused on what truly matters to you rather than being swayed by outside influences.
• Find free or low-cost ways to socialize and enjoy life. Build connections through shared experiences, not material possessions.

By focusing on your own values and what truly brings you joy, you can break free from the cycle of spending for social status and create a more financially secure life.

7. Avoiding financial education

Avoiding financial education is a habit that keeps you stuck in a cycle of confusion and poor money management. Many people find finances intimidating or overwhelming, but not taking the time to learn can have serious consequences.

Signs to look for:

Here are some signs you might be avoiding financial education:

• Feeling overwhelmed or confused by financial terms
• Procrastinating on important financial tasks
• Making decisions based on emotions rather than facts
• Relying solely on others for financial advice

Why it’s a bad habit:

When you avoid learning about finances, you’re more likely to make uninformed decisions that can hurt your financial health. This habit can perpetuate a generational cycle of poor money management and cause you to miss opportunities for wealth-building and financial growth. You may also become more vulnerable to scams and bad advice and constantly feel “behind” or “lost” when managing your money.

How to break the habit:

To take control of your financial future, start by educating yourself with these simple steps:

• Start with basic personal finance books or reputable websites. Choose accessible resources that help you build a foundation in budgeting, saving, and investing.
• Follow financial experts on social media for daily tips. Regular exposure to helpful content can make financial topics feel more approachable.
• Attend free financial workshops or webinars. Take advantage of opportunities to learn from professionals without spending a dime.
• Schedule regular "money dates" to review and learn about finances. Set aside time each month to assess your financial situation, read up on new topics, and make informed plans for your future.

To explore personal finance more deeply, consider listening to podcasts or reading books that break down complex topics into simple, actionable steps.

You can also check out my book, Money for Couples where I provide practical guidance on managing money effectively, having productive financial conversations, and creating a personalized plan for living your Rich Life.

By taking small steps to improve your financial education, you’ll build the confidence and knowledge needed to make smarter decisions and achieve your financial goals.

What happens when you don’t know what’s going on with your finances

When you don’t know what’s going on with your finances, it can create frustration, misunderstandings, and tension in your relationships and lead to a landslide of bad money habits. In this conversation, I spoke with Carrie and Taylor, who have struggled to get on the same page about money despite being together for eight years.

[00:03:12] Ramit: How long have you two been together?

[00:03:15] Carrie: Almost eight years.

[00:03:16] Ramit: Eight years. Okay. Carrie, when you got together with Taylor, were you already pretty savvy with money?

[00:03:25] Carrie: Yes. Maybe not great at doing all the things, but I knew what I should be doing and was doing some of those things, for sure.

[00:03:33] Ramit: Was it concerning to you at all that Taylor was not at the same level of financial savviness?

[00:03:39] Carrie: Once I realized it, it took a while. Yeah.

[00:03:44] Ramit: How long?

[00:03:46] Carrie: Probably six months of dating.

[00:03:48] Ramit: So Carrie, we’re here to talk about the role of money in your relationship with you and Taylor. And I was struck by the application that you wrote. Uh, has Taylor seen that application?

[00:04:02] Carrie: He’s not.

[00:04:03] Taylor: Oh, no.

[00:04:03] Ramit: Okay. Uh, would you mind if I read some of it out loud here?

[00:04:08] Carrie: Sure.

[00:04:09] Ramit: Okay. Taylor, the reason that I was struck by this was the severity and seriousness of the words that Carrie wrote. “I’m a 33-year-old woman who has been in an eight-year long relationship with my partner, and we still can’t figure out how to talk about money together, and I’m at my wits end. I have been ready to get married for the last three or so years, and now that he makes more, he’s starting to express his desire to take that step too.

[00:04:41] “However, in the back of my head, I feel hesitant to say yes because I am so frustrated with his lack of care or desire to talk about financial concerns, plans, etc. I’M SO TIRED OF VENMO REQUESTS AND FIGURING OUT WHO PAYS FOR WHAT.” I’d like to pause there. Carrie, you remember writing that?

[00:05:10] Carrie: Mm-hmm. The wits end part was I feel like I’ve tried a lot of different avenues to make it exciting, or to ask a question, or to draw him in, and he gets really excited about the dream planning. We love to talk about the dreams, and what could it be? But then when I start delving into the details, it’s a complete shutdown and block.

[00:05:38] Ramit: Thank you. Taylor, hearing what Carrie wrote, how do you receive that?

[00:05:50] Taylor: Me being me, uh, sucks. I don’t want to say, though, that it hurts because it doesn’t. I don’t care. She’s the one that’s feeling this way, so it just sucks. Yeah. It just sucks to hear. Because I should be better and should, I don’t want to say be more of a man in this situation, but be, um, just more communicative and a better partner in general. Uh, I don’t care about what I’m feeling. I care about what she’s feeling.

[00:06:37] Ramit: But I care what you’re feeling. So what are you feeling right now?

[00:06:45] Taylor: Oh, man. Uh, probably the one emotion I hate feeling.

[00:06:53] Ramit: Tell me.

[00:06:54] Taylor: Uh, disappointment.

[00:06:55] Ramit: At who.

[00:06:57] Taylor: Myself.

This example shows how avoiding financial discussions can lead to deeper issues over time. By taking steps to understand your finances and communicate openly, you can avoid the stress and conflict that comes from being in the dark about your money.

Want to dive deeper?

If you’re ready to take control of your finances and want to explore even more money habits that might be keeping you stuck, check out this video. It covers seven additional habits that could be quietly sabotaging your financial progress — and, more importantly, how to overcome them!

Beyond that, you might need some help. Maybe you have a complex financial situation, like a blended family or a looming retirement. Maybe you have a specific question; I once hired a financial advisor to look over my finances and give me a second set of eyes on my asset allocation.

But you should never, ever pay a percentage of your assets as a fee.

For example, if you’re paying your financial advisor 1 percent in fees, you’re literally giving away more than a quarter of your lifetime returns to Chet so he can pay for his next BMW. That 1 percent in fees is worth far more than all the lattes you’ll ever buy combined.

I don’t want you paying hundreds of thousands of dollars in fees. If you want to pay a great advisor a few thousand dollars for a financial plan, or $250/hour—or even $500/hour—great! (I paid my advisor an hourly rate, and I was happy to do it.) But never a percentage. You can find advisors who charge hourly or flat fees at napfa.org or by searching “Ramit Sethi advisor recommendations.”