Bad habits around debt are draining household finances across Australia.

The nation’s $32 billion of credit card debt that’s accruing interest — often at interest rates near 20 per cent — is the biggest example of wasting money on expensive borrowings.

However, there are other debt habits that can be just as financially dangerous, warn budgeting and finance experts.

Understanding these — and whether you are guilty of any — is a big step towards getting on top of your loans and saving money.

Consumer finance specialist Lisa Montgomery said one key habit was people failing to prioritise paying back money they owed.

“It’s interesting mentally how we think perhaps that’s not as important over Christmas and the holiday break,” she said. “We seem to prioritise social activity over the top of these debts, but they don’t go away.”

Some people believed it was OK to be late paying certain bills, Ms Montgomery said.

“Sometimes we don’t realise the effect, in particular with our credit rating that’s becoming more important these days as there’s tightening of credit parameters by lenders.

“Thinking that it’s okay is not okay.”

Missing debt deadlines was especially costly with energy bills, where people could miss out of discounts of 20 per cent or more — worth hundreds of dollars a quarter — even if they were just one day late, Ms Montgomery said.

Juggling credit card balances is another bad debt habit. Ms Montgomery said switching money between a collection of maxed-out credit cards was not sustainable “and it’s costing you money”.

Sort My Money founder David Rankin said Australians’ “instant-gratification lifestyle” led to instant debt through credit cards, personal loans and buy now pay later schemes.

“We are bombarded by ads telling us we can have everything now,” he said.

“What they don’t tell us, though, is that everything probably includes a heap of debt and years of loan repayments.”

Mr Rankin said the best way to beat the instant-gratification bad habit was to develop a delayed gratification mindset.

“Instead of applying for a credit card to finance your dream purchase, open a savings account,” he said.

“Set up a periodic payment into the new account to happen after each payday and enjoy watching your pile of money grow.

“Handing over cash feels great, and there’s no financial hangover to worry about.”

Ms Montgomery said the simplest way to break bad debt habits was to understand where your money went. This means going back through three months of bank statements to get a clear picture of your spending and how much money should be put aside for repayments.

“It’s a 30-minute exercise. I don’t think we realise how simple it is,” she said.

Ms Montgomery said changing a bad habit could be difficult if your spending way exceeded your income, but not to hard for those who discovered their extra spending was on “incidental or social wants”.