The secret of being rich lies in the sub-conscious of every human. We are so gifted to live in lack. Little wonder why the elites of the society say that poverty is a thing of the mind. This is really not far from the truth. Most times we get broke, not because we are not working hard enough but because there are some key principles that we fail to keep.
Have you ever been in a situation, were you have some amount of money in your possession and before the end of the day, you are left with nothing?
The secret of wealth lies in avoiding what I call Money Mistakes. If you do not avoid this destiny destroyer, you might end up always being broke.
The principles you would learn in this article, would guide you in your part to genuine wealth.
Below are common money mistakes and why you should avoid them.
Ensure you read this post till the end, as I can guarantee you would learn a lot.
Money Mistake 1- Borrowing money to start a business
Do not borrow money that accrues interest to start a business (except if you are paying for it through your salary); only borrow to grow your business. This is because business takes a long time to gain ground and begin making profit, yet most loans repayments have to be made within a month of taking the loan or even earlier. Therefore, never borrow money to start a business expecting that the business will generate income to pay back the borrowed money plus the interest.
Money Mistake 2- Spending money you are yet to receive
Do not spend money you haven’t received. Don’t even promise someone money based on a promise you have from someone else. If someone tells you: “Ezra, come to my office tomorrow at 9am and pick N3,000″don’t go out to buy items on credit based on this promise, with the hope that you will pay off your creditor when the promised money comes; it may not come as promised and this will leave you in problems with your creditors.
Money Mistakes 3- Spend before you save
If you want to save, whenever you receive money, don’t start spending hoping that you’ll save what remains. Normally what remains is zero because as long as money to spend is available, the numerous things you can spend it on are also available. And things to spend on even incite their ‘relatives’ so that you spend even more than you had planned. When money to spend is not available, we naturally find a way of doing without it. That’s why I’ve learnt to save in an INVESTMENT ACCOUNT. Once I send money there I assume I no longer have it. Before you spend any money, put your savings aside then spend what is left after saving.
Money Mistake 4- Begging the rich for money
When you get an opportunity to meet a very wealthy person, never ask for money. Ask for ideas on how to make money. They may even choose to give you money on their own after seeing that your ideas are great, but let getting money from them never be your objective.
Money Mistake 5- Saving without investing
Keeping your seed instead of planting it. Many people stop at saving. It’s very, very difficult to save and have all you need to maintain your lifestyle especially after retirement. When you save, your savings are seed; plant it. When you just keep the seed (saving money) some seeds begin to die (eaten by inflation and the like). That’s why I recommend that you read about the different types of investment vehicles you can use to grow your savings. I am not necessarily talking about putting the money in a business, because you can easily lose money in business. I am talking about putting it in an investment.
Money Mistake 6- Giving out what you cannot afford to lose
Never lend someone money you are not willing to lose. By the time you lend someone money, be contented in your heart that should the person fail to pay, you will not die. You should not even lose that person’s friendship if they fail to repay the money you lent them. If you feel the person might fail to pay you and this will not affect your relationship with them, then lend them money. If their failure to pay would make you hate this person’s entire clan, please advise the person to go to the bank.
Money Mistake 7- Standing as guarantor
Never append your signature to guarantee someone on a financial matter if you are not willing or able to pay the money on their behalf. Do I have to explain that one? No, it’s self-explanatory.
Money Mistake 8- Carrying so much cash about
Avoid keeping money you don’t intend to use in the short-term within easy reach. For instance, don’t walk with N10,000 in your pocket when all you plan to do in a day costs N2,000. Like I mentioned in Money Mistake 3, there are always expenses available to gobble any money that is within reach, so if you don’t want to lose it, put it away in a safe place.
Money Mistake 9- Keeping so much cash in the house
Avoid keeping money in inappropriate places e.g. in socks, under the pillow, in a pit, in the sitting room, in the bra, in a travel bag that you will place somewhere in a bus … impulse buying is a devil that will keep you busy!
Money Mistake 10- Buying what you do not need
Spending money on an item that you can do without (at least for the time being). These days when I pick money from my pocket or wallet, before paying for something I ask myself: What would happen if I didn’t buy this? If I find I can live with the consequences of not having that thing, I smile and walk away.
Money Mistake 11- Paying more for less
Paying an amount for something that’s not the minimum you can get that same value for. In other words, if you are at Spar and you pay N15,000 for a shoe that you can get at N3,000 at Rumuokoro, that’s a money mistake except for those who have achieved financial freedom.
Money Mistake 12- Helping everyone in need
Wanting to be the savior of the world by helping everyone in financial need. My sister, my brother, you are not Jesus. If you find it so hard to say no to a financial demand, you may think you are practising generosity when in actual sense you are committing (financial) suicide. We are not learning to be miserable here; we are learning to live within the boundaries of reality.
Money Mistake 13- Spending more than you earn
Consistently spending all you earn or more than you earn. It’s like having a drum where you have an inlet that’s smaller than the outlet. It will never get full. And should the inlet ever reduce significantly the drum will run dry. If you do it the other way round and the inlet is bigger, it will get full and even overflow. Hence, we have to always ensure we are widening the inlet while narrowing the outlet – all the time. Your side hustle comes in handy!
Money Mistake 14- Misplaced priorities
Thinking about short-term only and forgetting about long-term or thinking about the long-term and forgetting about the short-term. For instance, Lydia was told that there’s money in land. She saved money over a long period of time and bought 30 acres of land. Now she has the land but she is always broke. She is always complaining. She’s disgruntled and she doesn’t seem to see herself earning from the land in the near future. Now, let’s ask ourselves: Having 30 acres of land and no money to feed your family or take a child to hospital, is that wealth or poverty? I think Lydia only looked at long-term needs and forgot that she has short-term needs that require money. What of those who find they are one paycheck away from salary? Are they thinking about the long-term needs?
Now be sincere, are you guilty of any of the above listed money mistakes?
Drop your comments, suggestions, experiences etc, using the comment box below
There is still hope, begin today to avoid those mistakes.
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Disclaimer– This article is written for the general public, it is a collection of ideas from various online sources. It is not a property of XPRESS GIST.