Avoiding common money mistakes can save you hundreds of thousands of naira/dollars, if not millions, throughout your entire life. Majority of the battle we tend to have is centred around how best to use your money.
- Mistake #1: Rethink your Spendings — Common money mistakes that affect your money and capacity to be rich, plays a significant long time role in diverting your spendings to insignificant expenditures. If left unchecked would keep you financially constrained, so take action! Saving that minute #5 buying store-brand cereal instead of buying the biggest brands won’t make a difference. Instead, take out time to study stock and learn about the best interest rates or hottest stocks right at the moment that could yield short term and long term dividends. You can also subscribe to automatic saving packages and investments. Then allow your money to grow gradually.
- Mistake #2: Relying on willpower — Several people rely on willpower to restrain themselves from dining out or purchasing new outfits. Even if you take those extreme measures, at the end of the day it is insignificant. That #1,500 at the end of the year is irrelevant unless invested the money.
- Mistaking #3: PROCRASTINATION — Procrastination devalues your money, so invest! And starting as early as possible is the easiest pathway to financial freedom. As a 25-year-old, if you invest $100 each month for 10 years at an 8% interest rate, their account will be worth $200,061 by the age of 65. If your colleagues start investing $100 per month at age 35 for 30 years, their account statement would be $149,036 at age 65. Although the second person made contributions for 20 years running, they still achieved a sum $50,000 less because they later than the first person who kicked off from age 25.
“What distinguishes the rich and the poor is the poor man’s inability to capitalize on opportunities to grow wealth”
Read: Financial Planning Guide