7 Rookie Financial Mistakes That Will Leave You Broke
It’s terrifying.
You look at the number on the screen and feel the tension building up. You think about what’s left in the pantry.
It seems like it will be a noodles-with-butter week again.
The worst part?
You don’t even know how it came to this. You promised yourself you wouldn’t let this happen again.
Now you’re screwed until your next paycheck.
Is it possible to live a life where you don’t have to worry about money?
What about being able to afford stuff without feeling guilty?
Let’s talk about the most common and unintentional mistakes that keep you broke and what you can do about them.
1. You Have a Poor Person’s Mindset
Your first step towards healthier finances is shifting your mindset. When your thoughts come from a place of scarcity, your actions will match your thoughts.
Having an abundance mindset starts with being grateful for what you already have. It’ll help you see the opportunities where others only see the challenges.
You can start your gratitude practice by writing three things you’re grateful for. Doing it every morning will switch your mindset from scarcity to abundance.
2. You Have No Clue Where Your Money Is Going
One of the worst feelings is having no clue why your wallet is empty; that’s why getting clear on your spending habits is crucial.
Tracking your expenses empowers you to choose what to spend on; it allows you to save money, and it helps you reach your financial goals.
Pick one of the many apps you can use to start tracking your expenses and get a clear vision of where your money is going.
3. You’re Treating Your Finances Like You’ll Die Tomorrow
The main difference between enjoying your life and recklessly wasting your money is whether you are planning your finances and saving some money or not.
Saving money is part of living your best life, and it is a relief whenever you need cash for an emergency or an unexpected payment.
You can start by deciding how much money you want to save and then setting an automatic monthly transfer to a separate savings account.
4. You’re Not Clear On Your Spending Priorities
Once you know your spending habits, you can determine which expenses are essential and which ones you can either reduce or cut off.
Budgeting is not only a readjustment of your expenses; it’s also a powerful tool that helps you focus on what is important to you.
Focus on the expense categories that are essential and assign them a monthly budget — remember to consider your savings.
5. You Remain Blissfully Ignorant Instead of Facing Reality
It’s almost a law of nature that whenever you ignore a problem, it transforms into chaos, which is why you need to stop ignoring your debt.
Knowing how much you owe will allow you to take action and become debt-free. Yes, this can be scary, but it’s the key to having healthier finances.
Get clear on how much money you owe and make a payment plan, making sure that you prioritize the credit with the highest interest.
6. You’re Abusing Your Credit Card Instead of Leveraging It
Credit cards can either be your best friend or your worst enemy. Understanding how they work and leveraging them gives you a great advantage.
Using your card to purchase larger items will help you take advantage of your card rewards. Avoiding using your credit for smaller things is also a good strategy.
Look at the rewards that your credit card is offering. If they are worse than their competitors, it’s time to change your provider.
7. You’re Neglecting Your Most Valuable Asset
When you ignore your development, you’re damaging your finances. By prioritizing yourself, you’ll boost your self-esteem, your health, and, as a result, your wealth.
Investing in your education, health, and overall well-being is your smartest choice because it will increase your chances of living a more fulfilled, abundant life.
Make yourself a priority, invest in expanding your mind, and take care of your body. You’re the one investment that will always give positive returns.
Start With One Step
Imagine keeping your promises to yourself and not worrying about your next paycheck.
Imagine the relief as you check your balance and realize you still have more than enough money for the next couple of weeks.
Imagine saying goodbye to noodles-with-butter forever.
You deserve to live your best life.
You deserve to be able to buy the things that are important to you without feeling guilty the next day.
You deserve to feel like someone’s got your back.
And that someone is you.
