Mistakes we should not make with our money
There are some financial mistakes we should not make, especially during these uncertain times. Some of the mistakes can cost a lot of damage, immediately and over a period of time on your financial health.
Holding back your investment decisions
Dont wait till tomorrow to start investing. In fact this is perfect time to start investing gradually. With whatever money you have. Best is to start with a SIP (Systematic Investment Plan).
Stock markets have corrected nearly 20% from its peak. And bank fixed Deposit (FD) interest rates are on average 9.5% to 10%. So pick your stock, best mutual fund and other financial instruments as per your risk appetite, time frame and investment objective.
Start investing for future. If you do not do it now, the best times will run out soon.
Spending more than you earn
So you cant avoid the temptation of upto 50% off. It does make sense if you prepone your purchases and save some money during the festive discount period. But what if you buy stuff which you actually do not NEED, and empty your pocket.
Most of our financial problems start when you spend more than you earn. You become an impulsive buyer and start spending on just about everything by taking loans.
Have a budget for almost everything. And keep a track on what you spend, and what you earn, so that you get a fair understanding on what you have and where your money is going.
Do not avoid taking tough decisions. If you have to cut down on some expenses this month because you overshot your budget last month, Do So.
Defaulting on loans
Do not default on your loans. Defaulting on loans will impact your credit rating. And it will impact your future credit standing for taking loans.
And if you default on your credit cards, you will not only downgrade your credit rating, but you might also be charged upto 38% annually on your outstanding amounts on credit card. Some times it is not so easy to discuss discuss with your spouse on the necessity of cutting down on expenses. But you have to do it. For a better tomorrow for both of you.
Stop feeling poor or sorry about yourself. If you feel that the world is conspiring to make you poor, it is likely to come true. Start thinking good about your money, finances and future. The tomorrow will be much better than today.
And lastly do not forget to review your financial standing on a regular basis. If not more, than atleast once a year. You may find a shift in your risk profile, some avoidable expenses and better investment opportunities.