COMMON MONEY MISTAKE THAT YOU MAKE
Here we’ll take a look at some of the most common money mistakes that often lead people to major financial hardship. Even if you’re already facing financial difficulties, steering clear of these mistakes could be the key to survival and at long run, your financial freedom.
1. You don’t have a fixed amount that you save on a regular basis. There is no excuse for not saving at all, no matter how small. Once there is a consistent cash flow, a portion of it should be put aside steadily. You can start small and build up. Like we always say, it is not the bulk of the money that matters but the consistency.
2. You don’t have an investment plan. Your investment plan determines where you are headed in terms of wealth creation. If you fail to plan, you have planned to fail. You should have an investment plan with what, how and when you want to invest your money. Be specific about your goals.
3. When you invest for quick gains. When there is no long plan perspective for investment, you would eventually spend frivolously all the money you have saved all year. You should know how much you want to put away in different investment options, be it stock, real estate, and annuity etc. Avoid Ponzi schemes because they are not healthy investment options. Wealth requires long term planning.
4. Not having a budget. Having a budget gives you control over your money. A budget is a way of being intentional about the way you spend and save money. Some people don’t have proper planning on their steady income. There are some things that should not come off as emergency, like paying your rent or your wife’s discharge fee after delivery. These are things having a budget will manage for you.
5. Spending lavishly because you think more will come. Make plan on the money that you currently have. Quit spending money that is yet to come, hence, you run into debts. If you are sure the money will come, then wait for it before you start spending it.
6. When you keep all your monies in the bank. Some people’s net worth is in cash which is not supposed to be. Inflation and devaluation will take away your money if you keep it in cash. Create an Investment plan and keep your funds above inflation.
