6 THINGS WE DO WRONG WITH OUR MONEY

 

In this tight economy, money is an issue; this is a phrase that we hear a lot, but how certain is that? well the true is far away from there in many cases. Our financial situation depends in all, from ourselves, cause we control our destiny. We as humans are social creatures, that the majority follow the style, the latest gadgets, we imitate and do what others do in many occasions, and this parameter is what cause that, most of the people are stuck on debts, or do not find a way to move on to the next step in the progress ladder.

My salary is not enough, I should get paid more; this is another common phrase we hear a lot, attached to the one that says (i should look for a better job, that pays more), but how true is this, well in some cases the salary is really low and you should look for another job, that is a fact. but most of the time is not true, because, even if we land a perfect pay job, we will still be in the same situation.

All this, is due to a lack of financial discipline and education; remember, is not how much income you can produce every month, the trick is, how much you spend? and how much is save? 

Let's look at this 2 scenarios, Who live better?

Jhon with a monthly income of $5,000.00 and $4,900.00 Monthly Expenses.

OR

Hawk with a monthly income of $3,000.00 and $1,800.00 Monthly Expenses.

If you analyze, at simple view you will see that Jhon after expenses only have $100.00 left every month for himself. If we multiply this times 12 months Jhon will only have $1,200.00 save during the whole year, assuming no last minute live emergency situations arise (this is life and you know it will happens)

But in the other hand, Hawk have $1,200.00 left for himself. If we do the same math times 12 this hawk will have $14,400.00 (assuming no emergency pops up).

Now you can see that is not, how much you make but how much you can save.

Now lets analyze 6 things we do wrong with our money when we get paid.

(1) GO INTO A SHOPPING SPREE 

Some people use retail therapy to make up for bad days, such as a relationship breakup or a failure at work. But the most common reason is the belief that you can acquire something, only because you just got your paycheck.  But if you're not careful, this can result in the direct opposite and you will feel worse, like in most of the cases.

This is a phenomenon known as "compensatory buying". It happens if you buy something that corresponds to a perceived failing. or feeling of over power just for have a paycheck. For example, say you get romantically rejected, and you think it's due to your looks. You then go on a buying spree, getting new dresses, make-up, high heels, etc. You may feel momentarily better. But over the next few weeks or months, seeing these items will make you dwell on your perceived imperfections.

We must learn to stop buying stuffs, in reality, we don't need most of the thing we purchase, but we continue doing it as a impulse or memento which will lead to a lot of economics issues in the future.

Discipline yourself, think before you purchase and make a plan that even if you have the money to purchase something, you will wait 30 days minimum to get, is guarantee that after 30 days, 80% of those shopping wishes will disappear or will be replace with another, understanding, that we don't need that anymore..

(2) NOT SAVING FOR THE FUTURE

According to a Study made by Bankrate in January 2018, only 39% of the Americans, Have $1,000.00 save for emergency and the rest 61%, will recur to a type of loan or credit card to pay for it. But the numbers get scarier than that, because only 12 % of the Americans have between $1,000.00 and $4,999.00 and only 6% have over $5,000.00. We must learn a basic rule of money, which is; save with a purpose or goal.

(3) GO OUT CLUBBING OR PARTYING

Is nothing wrong to go out once in a while to release stress and share with friends and family, but every other day, every weekend, every opportunity, that is wrong. Eventually those entertainment will dry you sooner than later, and in most of the cases you will face a financial downfall next day, thinking in how much you spend for no reason, and stating that you should control yourself better. but moving again to the same rhythm and zone all over again. Let's think before we act, next time, when somebody invite you out, just say you will think about it, and take at least 2 o 3 hours to give your answer, you will analyze your budget and will come up to a conclusion if is worthy or not.

(4) CASINO GAMBLING OR LOTTERY TICKETS

This is a huge problem for many families, cause gambling can create addiction, and totally destroy the home and the family. If you experience this type of issues, my only advice is to call 311 and they will guide you to a free program to help you stay away from this monster, that not only destroy your finances, but your family and your life too.

(5) EAT OUTSIDE

Just like clubbing, eating outside and have a social life every day, can destroy our finances and a way that we don't realize, unless we seat and do the accounting. One exercise I propose to analyze our finances, is to grab a blank piece of paper, and at the beginning of the month, write, the date, time, where and how much you spend and also put a note of the main reason to eat outside. Then at the end of the month, you will be surprise, of how much you spend eating outside for no reason, instead of prepare your meals at home. Don't get me wrong, is nothing bad about share with friends once in while, but we must control the amount of times we do that, if we ever want to be financially free and stop living from paycheck to paycheck.

(6) STOP LENDING MONEY TO FAMILY OR FRIENDS

This is controversial topic, cause in a way, if you lend money in 95% of the cases you will loose the money, and if you try to collect the money, then you will loose the friendship or have a family dispute in at the end, the other part (the one you help, now refusing to pay) will call you Penny Pincher, Money Hungry or many others names, just because you asking for what is yours. If you want to keep them away, you have several ways, the most common is saying NO, but this lead to, they keep asking until you let go and finnally say yes. Other is more complex, just tell them that you only lend money if a guarantee is involve, let's say the ask for $200 or even $100 you just tell them, that you will do it, if they agree through a contract, put on a line, a car they have or TV set or anything valuble they may have, try to pick something that they are very attach, the idea is not to keep it but keep them away, if they really need the money and are really planning to pay you, they will not refuse to this and sign the paper works. Please speak to an attorney about it first. When you do this 99% of the people stay away from you, and do not ask you ever again, i guess they were never trying to pay you back.

FOLLOW THIS 6 RULES AND YOU WILL SEE THAT YOUR PAYCHECK IS NOT THAT SMALL AS IT USE TO BE

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