A lot of people can empathize if you have money habits that you are too embarrassed to admit. They are those habits that are frowned by people who feel like they have a moral authority to tell you what is right what is wrong. Well life can be a bitch at times and nobody goes through it without being pushed around financially from time to time. That is unless you have hit the genetic lottery by being born with a silver spoon.
Anyway who is anybody to say any of your spending habits are money mistakes made by teenagers who have yet to realize that the real world is centered around money. Whatever the case, here are the most common money “mistakes” you could already be making. If you continue making them, you will probably be led down a long road of misery with debt, if you are not already in a bad predicament already.
Lack of planning
It has been mentioned so many times in self-improvement literature that planning is a key criteria for anyone to get out of any problem. So much so that you might suspect that authors of non-fiction best sellers purposely include sections on this topic just to fill up their books to a more respectable page count. But this is not just urban mambo-jumbo. Most reasonable adults would probably agree that a lack of financial planning is just plain immature.
Without going into the detail of how a proper planning mind-map should be conceptualized, the aspects that you should go through include those for taxes, expenses, insurance, retirement, safety nets, and even lifestyle items like vacations.
Spending more that you can afford
Common sense tells us that you are looking for trouble by spending above your means. But we must also be realistic in accepting that not everyone can afford the means to simply get by. The silver lining is that these problems are usually cause by lifestyle choices. If you can live with yourself by living less luxurious lifestyle, you should be able to get by with reasonable comfort.
Overuse of credit
The credit card can be a sign of social status. It can also be the catalyst that drives you to financial disaster. Some people just have a knack of swiping their cards wherever they go. Payment becomes just a mindset that they can ignore in the mail. The logic is that they can bring forward their income with the use of credit cards. And with little tracking, they overdo it. By the time they realize that they are in trouble, it might already be too late. A sudden loss of income can also mean a panic attack for those who are trigger happy with the credit cards.
Not saving for a rainy day
Nobody want bad things to happen to them or their loved ones. But sometimes, things do occur that requires a sudden lump of cash. If you had not saved up for these emergencies, you might have to fall back on credit to pay for them. This takes you back to the previous point of overspending with credit facilities.
Falling prey to “get rich quick” scams
When we are making an average income, it can be so easy to believe that a sudden investment opportunity is a divine gift meant to reward you for the good that you have done over the years. Professional salesmen can pretty much sell anything to anybody if you give them enough air time. They grip your attention and reel you in for investments that promise returns that are unheard of. And almost always, you never see your money back. If something looks too good to be true, it probably is.
Getting advice from the wrong people
Because of how money driven the modern society has become, it is not a surprise to find salesmen from all walks of life trying to sell you as little as possible for as much as possible. Predators even sell you overpriced items that you absolutely don’t need. If you really have to buy a product or service, at least check on where the best deals and bargains are. You owe it to yourself. You will also be able to better live with it later when buyer’s remorse kicks in.
Failing to control your emotions
The best trait that makes a distinction between teenagers and adults is emotional stability. The ability to control emotions when making decisions. It is not cute that you absolutely have to buy a branded bag for $1,000 because it goes perfectly with your new dress. And just because a sale is going on does not mean that the world would end if you did not take advantage of it. Grow up and don’t let your emotions decide what you need to spend on.
Not having insurance
Insurance is one of those things that you curse at when you have to pay the premiums without ever making a claim. But you will learn how invaluable it can be when circumstances arise where you can claim from it via your coverage. A lawsuit, for example, can leave you out to dry financially. In the absence of insurance you will have to fork out those expenses and damages from your own pocket. When you know from the nature of your job or lifestyle that you are more exposed to certain types of risks, the smart thing to do is to call your insurance agent and learn what his policies can protect you from.
After mentioning the above mistakes, maybe you want to take note that the biggest money mistake is not directly related to expenses and saving. It is about how much emphasis you put on it. The most important things in life have little to do with your bank account. Even though you might or might not have financial problems don’t let an obsession over accumulating wealth blind you from the importance of relationships, health, and even your own life principles.
Many people around the world can get by without the luxuries in life. Getting out of the rat race may just be a distraction that you are blindly chasing due to some ideals others have implanted in your head.