We all make mistakes. After all, who doesn’t? But it is crucial to learn from mistakes and ensure that those mistakes aren’t repeated. You can learn not only from your mistakes but also from others mistakes. So, the next time someone talks to you along the lines of “This is a mistake I committed. I don’t want you to commit this mistake. I learnt it the hard way.” Pay attention to them and ensure you don’t do that mistake they did.
Here are some money mistakes you can avoid irrespective of who you are.
1. Not saving immediately
College term papers and exams are finally dealt with. Unfortunately, not only do they go for whatever job they can find but also have unreasonable expenditures on useless things. This is wrong because they could be saving all that money spent on those useless things. Rather than going for random jobs, they’ve to think about what career suits best for them.
2. Capital spent is lost
Even if you are the descendant of the greatest kings of the world, your money once spent will not return. Squandering away wealth will not do any good. Even the luxury car or the expensive gift you bought for your beauty will depreciate over a period of time. But if that wealth is saved and invested, it will return to you with a larger number. Instead of buying that expensive gift for your admirer, take him/her on an outing and share the cost. But be mindful of your expenditure always.
3. Not clearing all your debts
Having debts is very bad because you can neither save nor sleep in peace as the debt will constantly eat your head and will never allow you to reach your financial goals as you will be busy in clearing your loans. Set a deadline. Clear all your loans. Do this at the earliest. You don’t want the debt beast interfering in your financial matters anymore.
4. Neglecting insurance
Irrespective of whether you are relocating to a new city or just setting up your new house insurance is a must. Home insurance, car insurance, travel insurance, life insurance, etc are all available. No matter what, you still need insurance. Ignoring it is one of the biggest blunders you can ever commit.
5. Ignoring daily expenses
So you’re living independently. You need to get up in the morning, get your coffee and breakfast, prepare lunch, go to work, come back, make supper and go to bed. Your grocery expenses, water bill, electricity bill, telephone/mobile bill, etc have to be paid. Neglecting them can lead to serious disasters.
6. No budget
Hiranya is a young woman who graduated out of college only to find herself in a terrible financial mess! Her fault? Not maintaining a budget. Now she has to clear her student loan, pay her remaining bills, pay for her relocation to a flat near her office and so on. Ensure that you create and maintain a budget so that you will know how much money goes where.
7. Not saving for emergency and retirement
You didn’t know 10 years back what you would be doing today, so how will you know what you would be doing 10- years later? (Read why people forgo retirement planning and the reasons they give). You never know what will happen next. You might get into an accident or be fired suddenly. You need an emergency fund. After your working years, at the age of 60, you still have 40 years to live without working actively. You require retirement fund.
8. Not managing your own money
Partha is a young man. He ended up wasting all his first salary on unwanted things. For the next few months, he had to pay to clear the loan he took to survive that month. It is crucial to managing your money. Don’t squander it away.