Financial experts believe that you need to have a proper mindset to manage your money properly.
So, it’s a prerequisite that your views about money are accurate.
Check out whether or not you have these wrong views or say these silly things about money and managing your financial situation.
If yes, then get to know why you’re wrong and what you actually need to think and do.
1 “Credit card debt isn’t a thing to worry much.”
It is true that credit card debt helps you build a good credit report and eventually a good score, but it’s good as long as you repay the debt at every billing cycle.
If you start revolving your credit card debt from one billing cycle to another, then it might be bad for your financial situation.
If you’ve incurred a debt amount, which you can’t pay back in that billing cycle, then stop using your credit cards for some time. Try to repay the outstanding dues and then start using plastic money again.
This is because once you’ve huge credit card debt, it’ll be difficult for you to pay it off. As a result, your credit score might drop, which in turn, will make it difficult for you to obtain any loan at suitable terms and conditions.
2 “Budgets don’t really help”
Are you one of those who think that budgeting takes a lot of time and doesn’t really help to manage finances? It’s true that it takes some time to create a realistic budget that actually helps you to save money. However, it’s worth the effort.
Try for 2-3 months to plan a realistic budget. Don’t give up! It takes time to plan one. But, once you do it, your money worries will reduce. Planning a budget is the first step to build a secure financial future.
Plan a monthly budget and create separate budgets for special occasions like planning a vacation or holiday shopping. Also, you need to revisit your budget from time to time and make modifications if required.
3 “I am financially secure and can avoid debt since I make a good salary”
Do you have this misconception? Yes? You’re not alone. But, it may become difficult to pay the bills even if you make a good salary. You may end up spending more or you may incur debt problems due to a financial emergency.
Plan a budget so that you have a financial plan to build a secure financial future. Also, build an emergency fund to take care of the rainy days.
4 “Why will I waste my time by shopping around?”
If you get to know that comparison shopping can save you a lot of money, will you still think shopping around is a waste of time? Probably not.
Always shop around and compare apple with apple, so that you can judge who’s offering you similar services or even better terms and conditions at a relatively low rate. If you have a time crunch, comparison-shop online to get an idea whether or not you’re getting the best rate.
5 “Why should I think of retirement now? I’m too young!”
According to the financial experts, this is one of the silliest things people often view and say about their finances. But, the truth is that a person is never too young to start thinking about his/her retirement.
You should start thinking about it right from the time you get your first job. The calculation is simple. If you start saving for your retirement in your 20s, then you’ll have more time to save money in your retirement account, in comparison to if you start saving in your 30s. By doing so, you can be rest assured that you’d be able to maintain your standard of living even after retirement.
6 “A verbal contract and a firm handshake is as good as signing a contract.”
Before knowing whether it’s good or not, just answer, how much do you know about the person? Can you believe him/her blindly?
Even if you say ‘Yes’, you should sign a contract in spite of it being a tedious process. You never know when the other person will change his/her mind. If you don’t have anything written, you won’t be able to prove that it’s a breach of contract.
7 “A password is difficult to remember, so let’s make it simple.”
If a password is difficult to remember, then it’ll also be difficult for the fraudsters to guess it. So, what would you prefer? A password, difficult to remember, but your account is safe; or, a password simple to remember and also easier for fraudsters to guess.
Try to give strong passwords to your accounts and it’s better not to access those accounts from public computers. And, try not to give your name, age, etc. as passwords, which are easy to guess.
8 “I need to buy this.”
This is probably one of the popular silliest things that most of you have said to yourself while buying a relatively high-priced item.
Experts say that most of the times, your desire to buy that item will lessen if you give sometime. The reason being that usually you purchase on a whim. So, the next time you feel such an urge, leave the store and give yourself 1-2 days time to decide whether or not you still need it.
If you have any other views which you aren’t sure whether right or wrong, you can consult a financial adviser.
Get your thoughts correct, have the right attitude towards money, plan your goals and work towards achieving them to build a better financial future.