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Published on February 18th, 2020 | by minshewnetworks

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Common Money Mistakes People Make

Wouldn’t life be so much easier if we had an unlimited amount of money in our bank account? Alas, unless you’re one of those lucky rich and famous people, that’s just not going to be a reality. You’ll need to deal with the realities of trying to stay in a healthy financial state. But here’s the thing: sometimes, we’re our own worst enemy when it comes to our money situation. We spend more money that we’d like to — or should — and then wonder why our bank balance is looking a little uninspiring.

 

In this blog, we’re going to take a look at a few ways that people spend more money than they’d like to and more. Take care of these problems, and you might just find that your financial situation quickly begins to look a lot rosier.

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Money Black Holes 

 

One of the main problems when it comes to personal finances is that people just aren’t aware of their financial black holes. It’s much easier to keep your head buried in the sand than it is to confront your money situation, but “easier” doesn’t equal “better.” Take a look at your finances, and you’ll have a better sense of where your money is going. It could be that by simply investigating your financial outgoings, you’re able to notice a recurring problem. Moving forward, you’ll know the financial area that you need to improve.

 

Daily Treats 

 

Life can be hard, and we all like to have little things that give us a little boost. But if your treats are affecting your bank balance too much, then you’ll want to rethink whether they’re as good for you as you initially thought. Perhaps one of the worst offenders when it comes to unnecessary daily expenses are those expensive coffees. Individually, they’re not going to cause any damage to your bank account. But if a $5 coffee becomes part of your daily routine, then it won’t be long before their combined value equals a small fortune. There are two ways to put this money drainer behind you; you can stop drinking coffee, since it’s probably not doing as much for you as you think it is. Or you can learn how to make gourmet coffee at home — it’s not difficult, but it is much cheaper.

 

Expensive Lunch

 

Another area where people spend too much is on the food they buy during the working week. It’s more convenient to get your food from a takeout spot, sure, but there’s always a price to pay for convenience. So try to limit how often you get takeout. It’s significantly less expensive to prepare your food at home. If you can’t face the prospect of eating homemade sandwiches every day, then fear not: there are many better options available. Get in the kitchen, and look at cooking up an interesting lunch. You’ll be gaining a skill and learning how to save huge amounts of cash at the same time: perfect!

 

Seeing Your Friends

 

It’s really important to see our friends. It brings fun into our life, and helps push our mental health in the right direction! But seeing your friends should not have a negative impact on your bank balance. It’s normal that people suggest meeting up at a bar or restaurant, but you don’t have to say yes to it. Instead, you can suggest something that’s more budget-friendly, such as getting together in one of your homes for a dinner party. It can be just as good at going out but costs a fraction of the price. Alternatively, if you do want to go out, then do so smartly — you could go out for lunch (much cheaper), or look for local restaurant deals. You’ll always find something!

 

Home Expenses

 

There are certain areas of our lives that demand more money than others. Perhaps the biggest expense of all has to do with our housing. It would be so much better if the cost of our house was “all-inclusive”; by which, we mean, everything was included when you bought it. Alas, we can only dream. The good news is that you don’t have to be sucked into paying whatever costs come your way. You can influence how much everything costs you! Perhaps the best way is to be mindful of the energy that you’re using. You’ll save a lot of money, especially throughout the course of a year or more, if you remember to use your electricity and heating sparingly. You can also save money by investing in your home’s infrastructure, such as your insulation. It’ll make your home cozier and reduce your bills.

 

Wrong Deals 

 

There are certain things that anyone that wants to be part of the modern world needs to have in their life. The two most obvious are an internet connection and a cellphone plan. But just because you must have these in your life, that doesn’t mean that you should be paying top-dollar. It’s all about finding plans that work for you, rather than against you. For your cell phone, look at getting a sim card from SMARTY mobile; with them, you’ll only pay for the data that you need. There are many people, after all, that end up paying for a level of data and minutes that they never use. For your home internet, it’s all about figuring out what you need. You may be able to get super-fast internet, but is it needed? If you’re only a light internet user (browsing, streaming), then you’ll likely be content with a mid-level package, which will be much cheaper.

 

Tech Upgrades

 

Many of us like to have the latest iPhones, televisions, and laptops. But there’s no avoiding the fact that all of these items are expensive. If you’re forever buying new gadgets, then you’ll run up an expensive bill! So it’s important that you’re thinking smart when it comes to these goods. The first step will be thinking about what you really need. There’s little point in buying a new iPhone every single year; the updates are far too insignificant to justify the cost. When you come to buy any new item of tech, look at selling your current item — you could essentially get 50% off the price just by selling the item and using the money you raise to pay for the new goods.

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Hoarding Goods 

 

And speaking more broadly about selling your unused items, look into it! Most homeowners have a lot of unused goods just sitting in their cupboards. What good are they doing there? Very little. Round them up, make them presentable, and sell them online. You could make the equivalent of a month’s salary just by selling goods that you no longer want or need.

 

Letting Others Spend Your Cash

 

It’s bad enough if you get yourself into financial difficulties, but it’s even worse if you let other people affect your financial situation. Alas, that happens more often than we think. People can make grand plans for their birthday or wedding, and then expect other people to spend huge chunks of their hard-earned cash to attend. If you find yourself in these situations and know that you can’t do it, just say no. It’ll hurt, and you wish it wasn’t the case, but you have to do what’s right for your financial situation above everything else.

 

Always Driving

 

Cars are convenient; no-one’s going to deny that. But they can also be expensive. If you’re automatically getting behind the wheel of your vehicle every time you leave your front door, then it’s likely that you’re spending more money on getting from A to B that is necessary. So take a look at curbing your driving a little. You might find that it’s cheaper to take public transportation to your destination, especially once you factor in the cost of parking downtown. Another way to save money on the cost of getting around is to consider carpooling with your colleagues. Want to save 50% or more on the cost of your commute? That’s the easiest way to do it.

 

Expensive Lifestyles

 

It’s good to have an appreciation for the finer things in life, but if you’re surrounding your life with the finer things in life, then it won’t be long before you find yourself in financial difficulties. Your desire to have an expensive lifestyle should be an aspiration, not a reality no matter how much you earn. Life can’t always be champagne!

 

Lifestyle Inflation

 

One of the reasons why some people struggle to save any money even when they’ve got well-paid jobs is because they get sucked into the trap of lifestyle inflation. It’s just so tempting to spend more and more when you get a higher-paying job. If you want to build financial security, then this is to be avoided!

 

Carrying Debt

 

Finally, if you’re carrying debt with interest, then be sure to pay this off as soon as possible. It’s not the most glamorous way to spend your hard-earned cash, but is one of the best financial moves you can make.

 


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