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Common Mistakes in Managing Finances

Even though you have done some of the tips above, not everyone can run it successfully. There are many mistakes that commonly occur in managing finances. You can find out through the following list.

1. Only rely on salary
When we are already working and have a basic income, we often feel that it is enough just to live on that salary. In fact, there are many urgent needs that sometimes appear suddenly.

Not to mention that there is always the possibility of losing your job, both due to external and internal factors. Thеrеfоrе, you nееd tо hаvе a ѕіdе income thаt саn bе a ѕесоnd іnсоmе. It can be a business or an investment.

2. Think saving is enough
Saving is just a way to save money to be used at times when there is an important need. Saving money cannot provide great returns.

Therefore, saving is not enough. You also need to invest in order to get maximum benefits as well as become passive income.

3. Only have one account

You need to separate your savings account from an account for your daily needs. Because having just one account will encourage you to use it because you feel there is still a lot of money left over. Even saving money can be in vain.

4. Save at the end of the month
Saving must be done at the beginning of the month when you receive your salary. The reason is, if you delay until the end of the month, the money you hold has decreased a lot because it is used for shopping and buying various other needs. In the end, you don't save because the remaining money is low.

5. Ignore small expenses
Remember the proverb a little bit longer to become a hill? That's what will happen if you ignore small expenses such as parking, snacks, paying tolls, and so on.

Small expenses like that can sometimes be wasteful because they don't feel heavy. So, it's a good idea to record all expenses in detail to avoid such leaks.

6. Do not have insurance and an emergency fund
Insurance and an emergency fund are two important things that you should have. The reason is, without having both, your finances can be disrupted when something goes wrong. The financial burden will be even heavier because you don't have reserve funds to bear it.

7. Choose the minimum payment for credit cards
For those of you who have a credit card, don't ever choose the minimum payment. As a result, there is an interest that you have to pay and it can interfere with other expense items.

8. Not preparing for retirement as well as possible

The young age makes us ignore old age. As a result, we often procrastinate in preparing for retirement.

In fact, the older the age, the productivity will decrease. If we don't prepare a pension fund or a passive source of income for the future, retirement will be tough.