There are some recurring habits among people who are always short of money. To avoid them, all you need is a good dose of financial rigor.
Economic well-being is as important as strengthening physical health. In the vast majority of cases, the habits of people who are always broke they are chronic and transversal to all fringes of society.
To ensure that you don’t lose control of your family budget, you should be mindful of spending and ensure that you avoid basic financial mistakes that can destroy your monetary independence.
Habits of people who are always broke
don’t make a budget
If you want to organize your finances, you should start by defining your monthly budget. In order not to make mistakes, start by writing down your earnings and all your monthly expenses.
To save every month without sacrificing your day-to-day life, you must know exactly where and when you spend your money: classify your expenses, distinguish monthly expenses, identify sources of income and make the necessary comparisons.
Spend too much on unnecessary items
Impulse shopping is a very real problem and one of the habits of people who are constantly strapped for cash.
In order not to fall into temptation, follow the advice of experts in the field and use the 10 second technique: when you go shopping, hold the item you want to buy and try to quickly answer some questions: “when am I going to use this item?”, “do I really need to buy it?”, “can I postpone this expense?”.
If you can’t find the answers to these questions in just 10 seconds, leave the product on the shelf. This is an infallible technique that you should apply on your next shopping trip.
Don’t save for an emergency fund
People who have balanced personal finances are always prepared for any problem. In other words, they have an emergency fund to deal with eventualities that may arise throughout their lives.
The amount to be invested in the emergency fund is variable and should take into account aspects such as professional and family stability, age, fixed and variable monthly income, and also monthly fixed expenses (credits, rent, food and education expenses). ).
If you want to create your own emergency fund, it should be based on the amount of salary or monthly expenses over a period of six to 12 months: that is, this amount must correspond to at least six salaries or the total of six months of expenses fixed. Finally, don’t forget to put that amount into investment products or accounts that have little or no associated risk and are easy to access.
Don’t have a financial plan
If you want to acquire new (and good) financial habits, you must have a financial plan and control every euro in your bank account. Keep a monthly record of your finances to understand real consumption habits: only then will you be able to correct your mistakes and avoid excessive spending.
If you need help, seek financial advice. The support of specialists in the field will be able to guide you in the first weeks of your new financial life.
Do not set long-term financial goals
To ensure your financial health you should set goals. Start, for example, thinking about the retirement years, the mortgage on the house or car. But there’s more: don’t leave your money “sitting still” in the bank. Start investing to boost your return.
If you want to invest your savings, but don’t want to venture into high-risk products, choose, for example, Savings Certificates.
The habits of people with little money are chronic and, in most cases, are always justifiable. However, the secret to saving seriously (and without excuses) is knowing exactly what the household’s monthly expenses are. If you do not make this type of records, you are compromising your accounts.
If your salary disappears after a few days, it’s time to rethink your financial life. This is where we return to the first issue on this list and remind you again of the importance of creating a family budget.
Distribute expenses and earnings, identify sources of income and unnecessary purchases, create categories and review the budget on a regular basis. If you follow these tips, it is guaranteed that you will be able to save at the end of the month, regardless of the amount of your earnings.
They usually buy on credit on a regular basis
Credit purchases are increasingly common. The installment payment of the interest associated with these purchases is a temptation and, many times, the doom of anyone. Especially in the case of those people who are already in financial difficulties.
In order not to get lost among the interest rates, don’t forget that you shouldn’t spend more than 30% of the credit card’s available limit. If you do not follow this indication, you run the risk of paying unnecessary interest. To avoid overspending, you should always pay in cash. That way you always know what you can count on from the moment you make all your purchases official.