5 Money Mistakes You Must Avoid
When it comes to money, personal finance and even having to manage money, everyone’s ear is perked up, everyone’s interest hits a different gear but then we keep making certain money mistakes that endangers our financial growth.
Let’s get started on the five money mistakes you must, in fact compulsory to avoid to grow financially.
1) Avoid borrowing money to begin a business:
I know that look of “Oh- no! I have grand business ideas and I don’t have the money, what do I do?”
I remember beginning a business on borrowed money, I saw the borrowing as a form of stock buying and an investment by those lending me the money, honestly the business crashed, I was drowning in debt’s pool and had to struggle to pay off so I don’t drown.
Never borrow money that accrues interest or promises to, to begin a business, rather engage in other part time jobs to save up the capital for your business.
2) Never begin spending money you haven’t received. Supposing someone promised to give you money, do not go and buy things on credit hoping to pay off after you receive the promised money. For example, Ben promised to give you $4000, do not go and buy things on credit hoping to pay off when Ben eventually sends in the money. The money may never come and this may leave you in serious trouble with your creditors.
3) Do not hope to save after spending.
Insofar as there is money, there will always be a myriad of things to spend it on. Take out the percentage you want to save from your income once the money comes and spend what’s left. Save first before spending not spend first before saving. For instance, if you want to save 20% of your income, once you’re paid or you’ve made a profit, deduct your 20% first before spending.
4) Never borrow anyone money you are not willing to lose. Let’s face it, we will always have friends who will most likely ask us to lend them money, and when money is involved we know it could ruin friendships especially when debts are not serviced. The rule of thumb is, never borrow any amount of money you’re not willing to lose. Ask yourself, “if this money is not returned will I be fine? Will I still maintain my relationship with this person?” If the answer is no, do not borrow, you could help the person with quarter of the sum he/she is looking for but if your answer is yes, by all means go ahead and borrow.
5) Do not append your signature as a guarantor to someone when you do not have the financial capacity to refund the money. This is loud enough, if the person you are guaranteeing is unable to pay, the bank is coming for you,ask yourself if you can refund the borrowed money before vouching for anyone.
I will stop here today, but take note of these five money mistakes and avoid them to grow financially. I will love to know which money mistake you’re guilty.
I hope you have acquired new knowledge or old knowledge is reemphasized, I hope to see you have a grip over your finances and avoid these money mistakes.
