From generation to generation, people have been taught the traditional way to handle finances such as bargaining, saving, cutting cost and more. But these traditional habits of managing your finances may probably be the main reason why your finances are not in good shape.
Having a very tight budget. Budgeting is good; it helps you manage your finances and helps you save. However, if your budget is too tight, you might end up overspending on the things you have been craving for later on. Not only that, having a very tight budget is restraining. You have to reward yourself every once in a while. Your budget mustn’t be too tight that you wont buy yourself the things that could probably make you happier, which leads to making you more productive. You might also miss out on the right investment opportunities if you have a very tight budget. Don’t overdo it.
Buying things on sale. You should be mature enough to know that the word “sale” is a marketing strategy to subliminally force you to buy products. Just because it is on sale, it doesn’t automatically make it a good buy because you probably don’t need the item and it would probably have almost the same price even if it were not on sale.
Availing discount by buying more. “If you buy $35 worth of items, you will get free shipping,” you must also know that this is a marketing strategy to trick you into buying more. Be careful with discount offers that encourage you to buy more.
Buying Coupons. People buy coupons for a cheap price of the product they will get in the future. However, most of these coupons are probably things you don’t need in the first place. You probably will just forget about the coupon and end up wasting your money.
Saving too much. Saving is good. But you should save to invest. The money you keep will lose its value in the long run because of the inflation rate. True savings are money you have placed on your insurance, stocks, bonds, mutual funds, and other investment portfolios.
Choosing the cheaper product. American motivational speaker and financial guru the late Jim Rohn once said, if you are faced with two amounts, choose the higher one, or else you will live a cheap life. How true! If you keep buying the cheaper products, chances are, they will break easily, making you buy a new one again. It will make you spend even more. So, buy the more expensive one for better quality and long lasting durability.