When it comes to money, people are usually in a hurry to make decisions. While some may seem like a good idea at the time, some become a bad idea in the long run. But people still take that leap of faith with the popular consolation line, “Money will still come or God no go shame us.” In trying to avoid money mistakes, we should also remember that it takes intentionality and principle to avoid these seemingly normal but costly mistakes. Here are five money mistakes to avoid from practical experience
Not having a budget
Having a budget serves as a framework for all your financial expenses and decisions. A budget helps you monitor where your money is going and how you can improve and make better financial decisions. Not having a budget means that you will not be paying attention to those things that are important to you, like savings, investments, and needs. If you’re having a hard time creating and sticking to a budget, read here.
Lending money kept in your custody.
“It’s just two days he will give it back.” It might seem tempting given that your bosom friend needs it at the moment and will give it back before Tola asks for her money. You might think that you’re trying to use a stone to kill two birds, but you will only end up shooting yourself in the leg. First of all, when someone gives you their money to keep for them, it means they trust you. You might be killing that trust and credibility they had in you by giving someone else their money. Bad things happen, and you don’t know what might happen once you lend money out to another person.
Spending money you don’t have in advance.
“I dey expect money let me just run one or two before the money arrives.” This is a common mistake people make, that is, planning or making expenses on the money you’ve not received yet. This is one easy way to run into debt. What if the money doesn’t come? Planning and spending within what you have will ensure that you’re not caught unawares.
Spending to please people.
If there’s any lesson anyone should learn is how to say no. The truth is that people will keep asking because the problem no dey finish. If you cannot afford to spend or give someone a particular amount, it’s okay to say no. You don’t want to give or spend an amount of money to your detriment. Give if you have, but don’t beat yourself over it if you don’t have.
Taking a loan to take care of liabilities.
This is one common mistake that people do in this age and time where taking a loan has become a luxury. Another easy way to run into debt is by taking a loan, not just taking a loan but taking it to sort out liabilities. People want to borrow for everything. For example, people take a loan to buy a phone, car or even pay an outstanding loan. Taking a loan to do something that won’t bring you returns is not a good idea. No matter how urgent it is, resist incurring unnecessary debt for yourself.
Mistakes happen and are inevitable. What is most important is being able to learn from them and make sure they don’t repeat.