Five Ways to Sabotage Your Financial Plan

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When people decide to get their finances in order, they often have unrealistic expectations.

They assume they can cut spending here and there while earning a bit more and -- voila! -- all their financial problems are solved. The way you approach your finances can determine success or failure. Here are five ways people sabotage their finances even before they begin to work on them:

Choose an easy way out: Companies will try to convince you there is an easy way out of your financial problems because they know that's exactly what you want to hear. The truth is that there isn't an easy way out. It's going to take a lot of hard work and time to resolve the issues that got you where you are now. Ignore quick-and-easy fixes and instead set up a financial plan that addresses core issues.

Settle for a short-term fix: When finances get tight, some people eye short-term fixes with the assumption that things will get better in the long term. Getting your finances in order is a long-term project that will likely last a lifetime.

Believe there is no need for fundamental change: People who have financial troubles often believe there's no need for fundamental change. It's the same philosophy for those who believe a diet will help keep weight off forever without changing eating habits. Understanding and accepting that things will have to change is a big step toward getting your finances in order.

Have no tolerance for setbacks: No matter how well laid out a plan is, there are going to be setbacks. For example, it's common for emergency funds to be needed before they are fully funded. Many people hit that first setback and assume all their planning and effort wasn't worth it. If a single setback causes you to give up on your financial plan, you never committed to it in the first place.

Believe that finances are only about money: There are factors that may not appear to have anything to do with finances that end up having a huge impact. Health is a good example. If you suddenly fall ill, you could be out thousands of dollars. This makes taking care of your health an important part of sticking with your financial plan.

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