Top Things Not To Do With Your Money

The things that you should strictly avoid spending the money on could be a tough call. But some hard calls in life can turn out to be life-saving hacks for you. Impulsive decisions based on a wish list can hurt your pocket. Read along to find out some of the biggest mistakes people often make. 

Don’t Fall For The Alluring Sales Offers

Don’t fall for the alluring sales offers that may hurt you later. These are merely marketing strategies to promote deals that get into the customers’ minds, selling the product under the umbrella of hidden costs. At first, these special offers may appear to be very fruitful given the zero or low rate of interest on bulk purchases, but you may end up paying more. In one incident, a person financed a brand new JetSki for $10,000 with no down payment. He had fallen for the ad that advertised the product for $69 a month only. Unfortunately, he didn’t pay heed to the underlying condition that the low rate is subject to change after two years. Later, it changed to a retroactive interest based on the total loan amount. So he ended up paying for a more extended period than anticipated. 

Avoid Co-Signing A Loan You Can’t Pay Back

You shouldn’t co-sign a loan for someone else if you cannot afford to pay it back fully. It’s better to prepare yourself beforehand as you never know whether the other person will pay every installment each month. 

Don’t Live Above Your Means

A critical factor in living a debt-free life is to live below your means. Saving every single penny should be your utmost priority. Investments for meeting future requirements, like your children’s college fees, retirement back-up, etc., will pay off well later. Cathy Curtis, a certified financial planner, suggests creating a budget aligned with your values, beliefs, and ideals. 

Use Less Cash When Travelling

Using fewer credit cards to keep the credit card bills under check is a good strategy. However, it is highly recommended to use traveler’s checks or credit cards while traveling instead of cash. If you are carrying a substantial amount of money while traveling, it can invite unwanted attention and possible danger. You could be a victim of theft, especially in remote areas. 

Do Not Donate Money Via Phone

It’s effortless to transfer funds using a phone for a charitable purpose. Unfortunately, it is also easy for scammers to exploit this as a means for their fraudulent activities. It would help if you never considered sharing your credit card details over the phone. You can instead request the solicitor to have a written conversation with you via email. If the source is legitimate, they won’t hesitate to send an email and then check their authenticity. 

Get Your Groceries Delivered Home

Many people create a grocery list, thinking they will stick to it, but they do impulsive buying seeing the tempting offers on the store shelves. So what you could do is either compare the prices online and choose the best buy for you or have the grocery store deliver your list home if they have free or low-fee home-delivery services. This way, you can save money and get what you planned to buy initially. 

Late Payment Fees 

A well-thought-out budget every month could help you keep up with the bills. Sometimes you may have to face late bill payments, but this way, you will remember which dates the bills are due. A budget with calendar dates and reminders for bill payments can significantly reduce the number of late fees.

Don’t Use Shopping As Therapy

It is highly recommended not to shop when you feel sad. You may lose objectivity and wisdom when you are not in the right frame of mind. Moreover, you could buy unnecessary items and spend more to pamper yourself and feel better. This is what you call retail therapy. You should stay away from aggressive sales personnel, too, as they may trap you in their flattery sales techniques. Please don’t allow them to tempt you to buy something too heavy in your pocket. 

There are other alternatives and more meaningful ways of keeping yourself happy without spending a penny. Strictly make decisions based on your needs and bind yourself to a budget.

Track Your Money

It is not a great thing to brush aside your monthly expenses and income. It’s a strict no-no. You should always be mindful of your expenditure vs. income. Track your fixed costs, variable costs, and how much money you left in your hand after paying all your bills. Make a budget based on these observations; while you can’t do anything about your fixed expenses, you can certainly reduce your variable costs. Jot down your financial goals and keep visiting those every six months. 

Insurance Shouldn’t Be Your Only Investment Plan

Life Insurance sounds like a feasible plan, but you must look at some other viable options, especially if you are very young. For instance, emergency funds, investing in retirement funds, and liquid assets. You can eye on purchasing term options and investing the difference. 

Don’t Overlook The Full Cost Of The House While Buying

Owning a house isn’t easy. You should factor in all the costs that are included in buying a home. Be mindful of the hidden costs before you buy. Many people overlook maintenance costs, taxes, and utility bills and only focus on the net amount to pay for the property. Please consider all these costs along with the monthly mortgage installment. Otherwise, you could be signing for an unseen liability that may hit you all of a sudden, pushing you to raise another debt on your credit card. 

Don’t Buy a New Care- If You Can’t Afford It

You could be craving a new car, seeing your colleague buy one recently, but a brand new vehicle comes with a significantly high price, and your happiness could be fugitive. Consider buying a second-hand car instead to get rid of an ongoing financial burden.

Conclusion

Always evaluate your current finances before making any impulsive purchase. Ask yourself: Do I need this? Can I do without it? Most importantly, Can I even afford it? Go by your instincts and take decisions based only on your needs and budget. If you can stay within your means, then these sacrifices won’t go in vain, and you will indeed reap great results in the long run.