There are money mistakes that everyone makes. Some of those are minor mistakes that you can fix quickly. However, there are certain mistakes that can affect the rest of your life. You could end up destroying your chances of financial freedom and miss out on opportunities that would lead to you being a millionaire. Here are some of the money mistakes you need to avoid at all costs.
Not Having an Emergency Fund
If you don’t have any other savings account, you need to make sure you have this one. Without an emergency fund, you’ll end up relying on your credit cards to pay for last minute purchases, or you have to go weeks or months without necessities.
It’s time to focus on putting some money away in the event of the car breaking down or your washing machine going on the fritz.
Spending More Than You Have
It’s the reason that got the country into debt, and the reason so many households are struggling with large credit card bills and overdrafts.
Spending more than you have means you have to get the money from somewhere, and then you end up paying more back through interest. There are some purchases that work out as good debt’a new house or your student loan’but anything else should be avoided.
Constantly Eating Out
It could be a treat at a new diner that’s opened or you may opt for a takeout when you get home from work. The problem is you’ve already spent money on the food that is in your house, and that is now going to waste.
To make it worse, you are gaining weight because of the sugars, salts and calories that are in the takeout food.
Borrowing Money from Others
It could be borrowing $10 from a friend or $1,000 from the bank. Either way, you are putting yourself in a sticky financial situation. It is encouraging you to spend more than you earn, so you get yourself in debt.You also end up paying more for items because of the interest that you build up. It’s best to just avoid borrowing money as much as possible, except for possibly mortgages and student loans.
Spending More on Your Data
Smartphones are great for checking emails and using Facebook, but you only get a set amount of data. You could end up in a major financial pickle if you let yourself go over on your data, especially if you are abroad.
Turn off the roaming where possible, and limit the use of your phone if you’re on a tight plan. If you know you need more each month, look into upgrading your plan.
Not Letting Money Gain Interest
You need to stop spending the money as soon as you gain it. Your current account may not gain interest, but your savings one will.
Try putting the money to one side and letting it gain some extra interest during the month. You’ll soon find you don’t need the luxuries you thought you did.