5 Money Mistakes You Are Probably Making (4th one will surprise you)
5 May 2023
Most often we do not realise the mistakes we make until it's too late.
It's important to keep in mind that the choices you make today will affect your financial life tomorrow.
Wouldn't it be great if we knew the mistakes we are likely to make beforehand, so we could avoid them?
Here's a bunch of money mistakes you are likely to be making along with how to correct them.
Mistake #1: Postponing Monthly Payments
Falling behind on payments is a vicious cycle that is hard to break.
If you find yourself postponing monthly payments, catch up on those.
In order to avoid unnecessary stress, it is always important to stay on track and not delay your EMIs.
Check out more about staying on track with your goals on the MoneyPlanned dashboard.
Mistake #2: Lack of Financial Planning
Earlier, many didn't believe in the concept of financial planning.
Either they were well-to-do and didn't need it, or they thought they couldn't afford it.
Now the landscape is changing. More and more people are open to exploring the concept of financial planning.
The end goal of financial planning is to reach your goals.
Financial planning is the new cool!
Good financial planning is managing your money well.
It is striking a balance between meeting your needs and achieving your dreams.
It is creating wealth for your future with a comfortable cushion for any emergency.
Mistake #3: Accumulate debt and borrow money from others
Did you know that 71% of Indians are weighed down by debt?
Some argue that there is no debt that is good debt.
Taking on debt for big purchases like home or car has the potential to increase net worth is considered good debt.
Good or bad, sooner or later, a debt taken should be cleared.
Planning to clear your debts is an important aspect of financial goal planning that most people overlook.
It is best to avoid borrowing money from others, especially large amounts that can't be repaid in a short span of time.
Burrowing from friends, relatives might strain the relationship in the future if things don't go as planned.
Mistake #4: Not Linking Your Investments & Savings With Goals
Were you expecting this?
Nope. Not at all.
Well, this isn't surprising, it's common sense, right?
But, hold on.
Here are a bunch of questions for you.
Did you link your investments to your goals? Well, you might have.
However, did you link two or three of your investments you've made for the same life goal?
How about your savings along with your investments with your goals?
Did you allocate proportions to each of your investments and savings?
If the answer to any of the questions is "No", your financial goals are not fully optimised.
If the answer to all of the questions is yes, then congratulations, you are on track with your financial goals.
Link the various investments you make in several avenues along with your savings to each of your many life goals with a percentage of allocation.
Ugh! That is a mouthful of a task to accomplish.
Sure. It indeed is complex.
However, MoneyPlanned makes it super easy for you.
Check out our app and you will love how it brings your entire financial footprint together.
Mistake #5: Using Credit Cards For Everyday Expenses
When you rely on your credit cards for daily expenses, you fall behind on creating an effective budgeting system.
Excessive use of credit cards for everyday expenses may also result in overspending.
Using credit cards to cover shortfalls brings the added risk of running up a debt.
Good financial habits go a long way in building a healthy financial life.
The 5 common mistakes you can correct right away are:
Postponing Monthly Payments
Lack of Financial Planning
Accumulate debt and borrow money from others
Not linking your investments and savings with goals
Using credit cards for everyday expenses
For helpful insights and smart recommendations to reach your goals, visit MoneyPlanned, and plan for personal financial goals now.