Everyone knows what money is, and everyone wishes to have more and more of it. Many problems people have with regards to money stem from the fact that they don’t know well how to handle their money.
People fall into financial crisis even though they have high paying jobs because they don’t know how to use and manage their money. No one is born with the ability of how to make and grow money. Money is something we grow up to meet and hence we need to learn exactly how to work with it.
However, we are born into different families and some of us are brought up having some prior mindset and knowledge about money and the dynamics it entails. Some, facts. Others, just the same old myths.
The hard truth is that most of us handle money very poorly and so it has become an active ingredient in our financial struggles. There are basic things you need to know about money and the decisions you take concerning it if you want to avoid financial problems and not waste the money you worked hard for.
If you wish to have no troubles and worries about money, then you should consider avoiding these common mistakes people make with money.
Spending more than you earn
We live in an age where we are constantly bombarded with images and news about living very luxurious lifestyles and so most people have these lifestyles as their dreams. That is not even the worrying part. People spend on things they don’t really need, using money they borrow, only to keep up with the times. You will forever remain poor if you keep spending beyond your means. Spending less than we earn is a money mistake many people make and continue to make. Live according to your means else you will live your life only trying to settle debts and your future will look miserable waiting for you.
Spending before you save
Saving is the first thing we should do when we receive our money but unfortunately, that is the last thing we want to do with our money. We try to spend on all our needs before we save the remaining. That is one of the mistakes people do with money. Human wants are infinite and so if you want to spend on everything before you save, you’ll never save because you will exhaust your money and still need more to spend. Save first, and spend what is left. Whatever be the case, make sure you save first.
Thinking saving is the ultimate
Most of us think that when we save, then that is it. We leave the money in the bank and we get rich. Money saved should be invested. In the sense that, you need to put your saved money in places where it will multiply. That’s only when you can have enough to cater for your needs. People also tend to reply on the small interest their savings accrue. This is wrong. Look for ways to invest your savings.
Also read: 4 Things You Should Not Forget When You Want to Make an Investment Move.
Not following a budget
One of the things most people overlook when it comes to their money is having a budget. If you don’t have a budget, you’ll spend on things you don’t need as well as not keep money for things that you actually need. You won’t be able to quantify your expenses and you will always have expenses to make. If you have a budget, you’ll know which expenses you can and cannot make and how to allocate your money appropriately to different needs. Always have a budget.
Playing the role of a guarantor
Look, if you know that you won’t be able to pay any money on someone’s behalf, then don’t sign any guarantee for anyone. Don’t deceive yourself that the person is honest enough to be trusted. Anything can happen. So if you know you are not willing to pay for another person’s sake then never make that mistake of signing as a guarantor.
Keeping So much money on you
Why would you keep so much money on you? So that you can buy anything that fulfils your desires? Impulse buying will cripple you! Or do you just want to keep money on you because you think you might need it somehow? This is a mistake many people make. Trying to have as much money on them as their pockets can hold. Keep what you have budgeted to spend on alone with you, and some little extra to cater for stuff that might pop up with urgency. Keep just enough money on you and leave the rest in a safe place.
Trying to solve all problems with money
Money can’t buy happiness indeed! People spend more on things they believe would help ease their stress, take their sadness away or anything that is disturbing them. Sometimes you just need to relax under a tree and perhaps treat yourself with some tea. Never spend too much money trying to make yourself feel good and all. These fulfillment are usually on temporal. Happiness is an inside job.