During your lifetime you will certainly spend more than you should, not save enough or make some other poor financial decision. The little mistakes might not seem important but any money mistake can lead to bigger problems if not fixed.
What can go wrong when people don’t pay attention to the balances in their accounts?
If you don’t really know how much money you have, there is no way you can know how much you should be spending. In today’s world of mobile apps and alerts, there is no reason not to monitor your account regularly and make spending decisions based what you have. Doing this will help you avoid fees and to start simple budgeting.
Why is ignoring small purchases a big mistake?
Fortunately most of us are not impulsive buyers when it comes to major purchases but we succumb very easily to spending $10 to $50 at a time very frequently. This can actually add to hundreds of dollars each week and wreck your budget. The easy fix is to establish a spending account for these purchases separate from your essential account and only fund the account with what you want to spend each week or month.
How can using debt be the wrong move?
Most people will use debt in their lifetime and the purpose will be something that provides value such as owning a car or a home. Having debt is a problem with it is used to finance a lifestyle that is above someone’s means. The most reliable way to solve this problem is to re-look at priorities and financial situations and make changes to spending habits or lifestyle to match your income.
What do you consider the most crucial money mistake to avoid?
It is not really an action but more a state of mind. If you are denial about your current situation and your role in getting to that situation, it will be very difficult to make the changes needed to improve your situation. Owning your money mistakes and learning from them is the only way to solve this problem and once someone does this, they will be on the road to financial recovery.
What advice would you offer on how to avoid these and other money miscues?
It starts with setting up yourself for success not failure. Hope is not something that should be used when making money decisions or to be your plan to solve your money problems. Good decision making comes from having knowledge of where your money is going and using that information to setup rules and plans to follow that make the choice for you.