Are you are guilty of all of the financial mistakes in your lives? Most of the time, you are not properly educated. Other times, you are, but, you shy away from taking responsibility for your financial lives.
You are likely living paycheck to paycheck as a result of your excessive and frivolous spending habits. This means if you do not get your paycheck the next month, you will find yourself in a difficult situation.
Living in this manner means you are constantly depending on everything you earn, which leaves nothing to be saved.
There is a tendency that you borrow to purchase your liabilities which you think are assets. Those properties you buy that depreciates over time but you are still paying interest on them as a result of the debt surely are liabilities.
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You should stop in your tracks when buying them because there is a big difference between being able to afford something and being able to afford the payment.
It is pertinent that you make a conscious effort to eradicate those financial mistakes you made in the past and start a new financial phase.
Here is a list of financial mistakes you could currently be making and why you should avoid them.
Sharing your financial details is a financial mistake
Your financial details should be kept safe and secret. Sharing your details with anyone could lead to misuse of funds or transfer to third parties.
Do not ignore inflation
You should make a habit of investing with a focus on a higher return on investment. You shouldn’t invest if inflation is higher than the return on your investment. This is important for long-term wealth creation.
Contingency funds are a must to avoid financial mistakes
Yes, contingency funds are a must and must be an adequate one. This is because financial emergencies cannot be ignored. And you will be able to pull through a financial breakdown if you have adequate contingency funds.
This should be an account built to accommodate expenses for at least six(6) months. You can do this by cutting back on expenses and saving towards this. It should be constantly renewed when it is drained when things return to normalcy.
Paying credit card dues late is a financial mistake
Interest should not be allowed to accumulate if you’re using your credit cards. You should try as much as you can to clear up your debt within the 55 days grace period before interest is added to your credit card debt. You can ask for an auto-debit on your account from your bank to ease up the process.
Ignoring insurance purchases is another financial mistake
Unanticipated emergencies can send negative energy flying around you and your family. This is why you should take insurance purchases seriously. This will be able to account for those emergencies.
You need insurance protection in lots of areas of your life. Therefore, consider signing up for health insurance protection, life insurance protection, Homeowner’s Insurance, Renters Insurance, Automobile Insurance, etc.