Self Check #1: Are You Making These Money Mistakes?
Small mistakes can cost you a lot when it comes to managing your finances and saving your money. Here are some and how you can rectify them.
Everyone talks about saving and shares tips about investing. Meanwhile, it is equally important to understand the mistakes that are made by many when they start their investment journey. These mistakes are made by most Indian people, and if you feel that you might not be doing it, we assure you that sometimes we tend to do these unconsciously.
After reading the title, you might say that you never make any unnecessary purchases. However, most millennials do. According to a survey from Charles Schwab, 62% of millennials said they are living paycheck to paycheck and only 38% said that they feel financially stable. But why do they spend a lot of money? The same survey found that 49% of millennials said social media influenced them to spend money on experiences. 48% said they have overspent when sharing experiences with friends, whether it’s dining out or going on a group vacation, the survey found.
Even though this survey was done in 2019, we can assume that the financial situation of millennials and Generation Z deteriorated during the pandemic. Since social media is a major driver in pushing people towards spending more money, it is better to uninstall apps like Instagram, if they push you to spend a lot of money. Tracking all of your expenses religiously will also help you control your overall spending.
Ignoring Your Education Loan
When you take an education loan, your parents become the guarantors of the loan. You get an initial moratorium but you have to pay the dues after. Sometimes, when people get their first job, they become excited and start ignoring their responsibilities. They assume that the loans would attract a minimal interest and they can pay eventually.
However, everyone should know that failure to repay education loans can affect your credit score. Banks can also approach your parents, so before that happens, it is better to start paying off your debts from your first salary itself.
Take a long hard look at your monthly and yearly expenses. This is crucial because sometimes, companies might overcharge you by mistake and if you don’t analyze your expenses, you will end up losing a lot of money. Another example is that people continue to pay for credit cards that weren’t used by them anymore. You can open your email inbox and take a look at your subscriptions and bills. You might be paying for services that you are not using anymore or you might be getting charged wrongly.
Following Bad Advice
Social media is filled with a lot of bad financial advice. The main thing to note here is that following this advice blindly is a sure way to lose your money. Social media influencers do not know your personal financial situation and they do not know the assets in which you might have invested. Hence, doing your own research and choosing the financial instrument which is right for you is of the utmost importance.
There is a lot of misinformation in social media platforms such as Instagram, Facebook and Twitter. Most of the people who call themselves “stock market gurus” and “experts” do not have the right education and experience to give you personal finance advice. So, be careful of whose advice you follow on social media.
In The End…
We hope you will not be making these financial mistakes and be extra careful with your money. In our next blog, we will be talking about the next set of common financial mistakes that should be avoided by everyone. In the meantime, tell us about the best financial advice you have ever received in the comments below!