Wednesday, November 9, 2016
Serious Mistakes We all Make With Our Cash
Money mistakes. We all make them. We all think we don't, but at some point, we all have or will. Financial security has become more important than ever these days. So you need to make sure you understand and avoid these serious financial mistakes.
Not Planning for the Future
Too many of us don't have plans in place for our financial future. And this can prove disastrous in the long run. You don't want to hit middle age and find you have no money saved. Statistics show that most millennials these days are actually more likely to spend on holidays than saving for their pensions. And this is something you need to stop doing and keep one eye on the future. Make sure you meet with a financial advisor and start getting your money in order for the future.
Having Too Many Outgoings
Outgoings can cause a huge dent in our personal finances. The problems arise when we have too many outgoings that we can't meet the needs with our income. There are two options you have to try to deal with this. The first one is to reduce some of the expenditure and outgoings you’re currently facing. Another is to try to increase the amount of income you have each month. You can make use of things like pay day loans, online jobs and e-commerce to supplement your current income. This will give you access to extra funds that you might badly need. There are some occasions in which you may have unexpected costs that crop up. And you need to deal with these, so they don't cause you financial problems.
Poor Investment Strategy
Many people these days like to make investments for the future. These are essential for supplementing income, and making you and your family more financially secure. But, if you want to invest you have to do it properly. One of the big mistakes a lot of people make is that they have a poor investment strategy or no strategy at all. You have to be very careful when you invest money because if you get it wrong, you could end up making a big loss. You have to have an investment strategy in place to help you understand the volatility of the market, and what represents the best ROI for your money. If you can do this, you will be able to invest positively and get the most out of your money. Poor investment strategy can lead to loss of earnings and severe financial ruin.
The big mistake it’s so easy to fall foul of these days is impulse buying. This is something that we are all guilty of in certain scenarios. This is why it’s never a good idea to go food shopping when you’re hungry, or to take the kids with you. You need to resist those impulse buys that you don't actually need. These soon mount up and will end up costing you significantly more than you need to be spending. Think about how and why impulse buying happens, and the sorts of things we tend to buy on impulse. It’s estimated that around 90% of shoppers will make occasional impulse buys, and this is a lot of money going down the drain. So you need to look at how you can rein in your impulse buys and only spend on what you actually need to.
Failing to Compare
The Go Compare adverts might drive you insane, but they have a valid point. We need to look for the best possible deals out there. And the only way to do this is to compare and contrast prices so you can come to an informed decision. Now, you have to understand that failure to compare will more often than not result in you spending far too much money. Looking at things like car insurance or holiday bookings? Well, don't just take the first option you are presented with. Make sure you hunt around and find the best deal you can; you might be surprised by how much you save.
Making Life Decisions You Can’t Afford
One of the big things we all fall for is making those big life decisions we can't afford. This could be something like buying a house, or upping sticks and moving to London to try to make something of yourself. You have to consider that things like this are always going to cost you more money than you’re used to having to spend. It should come as no surprise that London is ranked as the most expensive UK city to live in. The average cost of a litre of petrol in London clocks in at around £1.15. It’s things like this that you need to prepare for so these costs don't take you by surprise. Too many people are making big life choices - like moving to London - and not accounting for the financial risks involved.
We all make bad mistakes when it comes to our finances because that's human nature. Many of us don't consider the risks involved in modern spending, and that's what gets us into financial problems to begin with. So, it’s important to understand these mistakes and ensure that we don't make them. Avoid these errors, and you will wind up in a much healthier financial position in the long-term.