Most people consider budgeting as futile and time consuming process. But the fact is budgeting helps you to carry out your big dreams by cutting-off the extra and useless expenses. Proper detailing enlightens you about your prime needs. It actually helps you to understand that the money spent on useless item could have been used on something useful and convenient to you.
The 10 regrettable financial choices which you make are as follows:
- Late start in budget making- Putting off budgeting is not the act of cleverness. The settlement of budgeting can let slip the wastage of money that could have been employ in more profitable expenses. It can help you to utilize money for you and your family’s financial sound life.
- Monthly unpaid credit cards- The due payment of credit cards are not the sign of responsible person. The one who has a responsibility on its shoulder of family and its future must never overlook such tasks, especially when it comes to household financial matters. The ignorance towards the monthly payment of credits cards can lead to your surplus interest rates that directly affects on your saving and household budgets.
- Lack of investigation before buying any financial products- Your money is earned with your every drop of sweat and time. Investing that money without any proper investigation on any financial product can lead you to big trouble. This also applies to loans. Different lending institutions have their own pros and cons. As such it is not possible for anyone to go to different banks and find out the details. Thanks to advancement of technology in India, now there are websites like Finance Buddha, where you can go and compare different loan products, choose the best loan and apply online. So, act wisely before you make any investment on any policies or funds. Do your homework and dig up the information regarding what cost you will be charged, the surrender charge, the amount you will receive at the time of policy maturity and other terms and conditions bounded to policies you buy.
- No emergency fund as back up- The time is the most uncertain in life. Everyone once in a lifetime go through a big financial emergency at some point. The emergency fund can be a big help in the worst time. If you are alone then you need to save more amount for bad days but if you are married and both of you are employed then less savings will be sufficient from both. Emergency fund serves as the backbone in worst time.
- Expenditure on unaffordable items- “Cut your cloth according to your cloth” the proverb explains that you should expense as much you can afford. The inversely proportion graph of your expense and salary can let you in big trouble. For example, vehicle is very important for many, but it takes no time to turn into discretionary expense.
- Clueless investments without any knowledge- It is better not to invest at all rather than investing in something about which you do not have any idea. It is highly advisable to find out everything related to your original choice of investment before going for it. Although it requires lot of time and effort but is worth it. But given the present scenario, everyone busy with their daily lives and the struggles (especially in metros like New Delhi and Bangalore), it is not possible to dedicate extra time to reading about investment instruments. In such cases, financial advisor can be the most dependable friend. The financial advisor saves your time and suggests you the policies suitable to your lifestyle and cutback your extra financial burden.
- No interest on actual profitable and important insurance policies- The earning person is the most important member of the family. The household expenses, children’s education, medical bills of parents, etc are the must pay expenses. Just wonder a life without that person. Horrifying! Must be. You must not only plan out on saving for your old age. You must also think about the family after you. The people who will be left behind if something unexpected happens to you. You must lookout for life secure policies that locks your family’s secure future. No delay must be done in such noble idea.
- Unplanned retirement- Many people never think for their retirement. They work hard to fulfill the basic needs of their family. Saving for retirement is very crucial step to be taken if you wish to spend your old age as well maintained and sound life style. Relying on your pension alone is not the wise choice. Your old age doesn’t bring you a sound health, you must not forget this.
- Avoiding spouse in financial discussions- Marriage bring two souls as one. Every decision you make post marriage is not solely your decision. Involving your spouse in financial decision will be the right step. In worst case, if husband goes through some unexpected situation at least wife is aware about all the policies and savings and she can stand up for the family in the absence of her husband.
- Being ignorant to your recurring fees- Recurring expenses eats up your wallet. And you need to put it on diet. Consider your daily or monthly expenses, there are many activities that can save you enough amount at the end of the month. You can save your gym fees by working out at home. You can save on petrol and diesel by car pooling, if you are smoking, you can save on it by quitting it which save both your pocket and health. So, if you really think wisely there are many such extra expenses that can be easily controlled.
If you follow the above said steps you will be definitely not kicking yourself out in future. Every penny saved today credits you tomorrow