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One does not realize the value of something until its gone. It can be people, things we own, the relationships we have, special moments like our childhood, school days, etc. Money also makes this list. No, we are not trying to be materialistic but realistic and asking you to adopt this mindset.
Money is a hotly contested topic. It is the reason for violence and theft, but also the reason for happiness, joy, celebrations, education, etc. Like everything else, money has a good side and a bad side. Money is the means to achieve various ends right from the mundane to bigger goals. It is a basic necessity of life; without money life, as we know it wouldn’t exist.
The Right Attitude
At the end of the day, it’s our attitude toward everything that counts. This includes our attitude vis-a-vis money too. It must be of respect and wisdom. Money is not begotten easily by everyone. Majority of the world’s population still lives in poverty and finds it hard to get by; essentials are still a luxury for many. Then there are those of us who don’t have anything to complain about – we have a decent job that may not get us a private jet or yacht but a respectable and dignified life which in itself is a luxury. A few lucky ones are born into wealth out of which many take it for granted whereas others value it and use it for good causes. Essentially, what we do with our money is what matters. So, whether you are rich or getting there, or want to start saving early, or are struggling to save money, we list out the top 5 things which you should not do with your money. These are important because to adhere to because financial stress is not worth it. It puts a strain on relationships, our mental health, and self-confidence. Plus it is an easily preventable situation if we follow some simple steps.
So go ahead and read about what NOT to do with your money and we hope things will fall into place:
1. Spend It All
Never! You must keep money aside for a rainy day. All that stuff you hear about living in the moment and not giving a fig about tomorrow is not to be taken literally. You must worry about the future and hence it is important to ensure you take care of it in the present. Spend when the need arises and on fixed expenses like the rent, utility bills, groceries, etc. Other expenditures can wait until the money becomes available or you have excess.
2. Live Beyond Your Means
If you are trying to match up to your friends or peers by dressing like them, looking like them, or owning things they own and in the bargain losing money like a running tap, stop it right now. You need to analyze your needs and lifestyle as per your means and your ability to afford. It is very easy to get swayed away by peer pressure and attention but this will only cause trouble in the long run.
3. Lending Large Sums
It’s good to help family members and friends in need because someday we may need their help too. However, loaning exorbitant amounts of money at one go is not advisable.
Think of it this way, the fact that someone is asking you for that kind of money implies they don’t have it, and secondly, they may be unable to pay it back soon. Due to various reasons beyond their control, they may be unable to pay even parts of the full sum for a long time. Now suppose there is an emergency and you need the money yourself who will you turn to?
So prioritize your needs and unforeseen exigencies. Lend small sums of money over a period of time. Be practical and don’t let emotions get in the way.
4. Take On Multiple Loans
We often don’t use our foresight when it comes to money and expenses and takes on more than we must. Taking on multiple loans can land us in trouble if we don’t account for unforeseen expenses and emergencies. If you have a personal loan going on, it may be wise to wait until it is fully repaid and then take on a loan for an appliance that you’ve wanted for a long time. Also, taking on multiple loans if you have a long term loan like a car or housing loan on is a bad idea.
5. Save It All In A Bank
The saying ‘Money saved is money earned’ is true but by diversifying your savings portfolio. Don’t just invest all your cash in a savings account because this will prevent your money from growing. As the price and value of material things like electronic appliances, for example, increases over time so does the value of money.
In order to meet the demands of inflation and growing prices, it is important to make your money grow simultaneously. So invest in mutual funds, bluechip funds, fixed deposits, bullion, real estate, etc. These instruments will fetch you interest on your investment and increase the value of the money you’ve worked so hard to save.
It is extremely important to understand the value of money early on. However, there are many of us who have mistakes in the past with respect to money. We overspend it, create a debt trap for ourselves, and are left to deal with tremendous stress which also extends to our loved ones. Adhering to some simple rules and maintaining a rational attitude regarding money is the ideal way to prevent this from happening.
One must never take anything for granted, most of all money. Money is a means to an end and not an end in itself. When we save money, we have earned it. However, this does not mean we become stingy and not live well. The key is to divide money into expenses, savings, and investments to live the life we want.Adhering to some simple rules and maintaining a rational attitude regarding money is the ideal way to manage money more efficiently. Click To Tweet
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