Talking about the most common financial mistakes that might lead you into financial hassle, so you avoid making these another time you invest or plan on building a better financial life. Check for the following mistakes if you are facing any financial hardships in your life.
1. Excessive and Waggish Expenditure
While we talk about expenditure, it is never less. Even an expenditure of 100 rupees a day for many days makes a lot of nuisances in one’s economic life.
2. Always High on Borrowing
Borrowed money creates nothing more than a burden on your head, it will create a heavy loan-paying responsibility on the borrower’s shoulders. Not just the matter of borrowed money, the case worsens if the interest amount keeps increasing.
3. No Planning of Money
When there is no money planning, there is an uncontrolled expenditure unintentionally. This expenditure may lead to major financial losses. It may also lead to a shortage of capital for anything important such as health checkups, family planning, etc. making a budget is important for a healthy financial life.
4. Quitting Your Job without a Plan
The plan is a fundamental need in finance, whether on a large scale or a household level. If one quits his currently paying job without any plan on how to earn a living might lead to major economically threatening conditions. One should have a plan on how to earn and where to work next or if it is a business startup the savings must be enough to meet the basic needs until the business really takes off.
5. Not Setting Future Goals
Earning and saving goals are necessary when it comes to the financing world. If one follows the same path throughout without any farther point to look at, they may never find themselves preceding. Promotions are some of the most basic goals of every individual and everyone wants to see themselves growing at a certain point in time, the same level of earning will be tiring, boring, and most importantly full of loss for an individual or a group.
6. Leading Without Insurance
Insurance is a guarantee of compensation under certain loss conditions, damage, health issues, etc. provided by a company or an organization. Going without an insurance plan might be dangerous and disadvantageous to you.
7. Excessive usage of Credit Cards
The usage of credit cards is almost like borrowing money as you borrow money from banks for your payment and the bank asks for an interest amount and this amount increases from time to time. This might create a huge burden on the user’s head. Unable to pay back the credit and interest may lead to legal action against the person filled by the bank/organization that is lending them money.
8. Not saving Up
One of the most ignored factors is savings in the financial world. While a person earns just enough to make a decent living, he/she starts to ignore the importance of savings. Making enough money is not enough to live a comfortable and peaceful life; the trick is to save as much as possible. Savings are the savior in financial life and a major win-win game when it comes to emergency conditions. Emergencies like the sudden loss of a job, downfall in business growth, or shortage of money in an important investment such as an own house or vehicle look for savings to cure and conceal them.
9. Lending Without a Second thought
Sharing is not always caring, especially when it comes to money. Be cautious of yourself and your needs before you investigate others’ financial needs. Be aware of the nature and the honesty of the one you are lending your money to; the worst condition would be that the person refuses to pay back your money while you fail to keep a record/proof of how much money you lend and for how much time.
10. More Expenses Than You Can Afford
Spending more than you can afford under peer pressure or under any pressure to look rich is a defeat game from all angles. Spending according to your limits can be a plus point in your personal and financial life and will help you survive in a long run.
By: Varnika Jain
Also Read: Small Business
