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How sustainable are your financial habits?

By Richard Barrington

For Five Cent Nickel

Published: Saturday, Jan. 18 2014 11:40 p.m. MST

Sustainability has become a key concept in environmental and resource-management circles. It’s also a good goal for your personal financial practices.

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Editor's note: This article ran originally on Five Cent Nickel. It has been reprinted here with permission.

Sustainability has become a key concept in environmental and resource-management circles. It’s also a good goal for your personal financial practices.

I’m sure it once seemed as if the world contained an endless reservoir of oil; but by the end of the 20th century it was clear that when people draw on a resource faster than it can be replenished, eventually shortages will occur. Similarly, there are some common financial practices that may seem harmless from week to week, but which will back you into a troublesome corner over the long haul.

The test, then, for your personal finances is whether or not your habits are sustainable — if you project those habits out into the future, do they result in your building wealth or facing bankruptcy? The following are several ways in which you should consider the sustainability of your personal finances:

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