Tuesday, 7 December 2010 23:23
Everyone looks back on mistakes they’ve made in their life and say they would do things differently if given a second chance. This is definitely true of money. Here are a few common mistakes people make with their money and how to avoid them.
It’s important to take your time when making a large purchase. Don’t go car shopping unless you’ve done your homework first. Make sure you’ve compared prices and have been pre-approved for your rate. Whenever you are shopping, make sure you set a budget and stick to it. The thrill of purchasing something new is fleeting; the reality of having to pay for it will last much longer.
Getting into debt
There are items you probably will need credit for like a house or car, but don’t use credit for “want” items such as electronics or clothes. Many people get their first credit card in college and rack up debt very quickly thinking they will be able to pay it back when they get out of school. This really adds up, and you can end up ruining your credit and chances for future purchases like that home or car.
Not having a plan
Flying by the seat of your pants can get you through a lot of situations, but when dealing with money, it can lead to problems like having to pay fees, getting into debt, and ruining your credit score. Make sure you have a budget and an emergency savings fund. Set goals for yourself like retirement or saving for a home.