No matter how much money you have, you can still get into financial trouble by making money management mistakes. Just follow the news and on a regular basis you’ll hear about a celebrity who you thought was worth millions and is now filing for bankruptcy. We have also all heard about retired athletes money errors.
Money management mistakes: Good income means nothing
It’s not enough to make a good wage; it’s what you do with it that matters. I recently read a story of a woman who worked as a secretary her whole life and passed away leaving a multi-million dollar estate.
Money management mistakes: 5 money mistakes to avoid
Here are 5 financial mistakes that can really hurt your future:
- Live on your money; not on credit: It’s so easy to make purchases that you can’t afford when you use plastic instead of money. It’s really important that you don’t spend what you don’t have.
- Make a budget and stick to it: Everyone should have a budget. It’s the only way you’ll really understand how much money is coming in and what’s going out. I think you’ll be quite surprised at what you’re actually spending and what you’re spending it on. Without a budget to rein you in, it’s easy to lose control.
- Have a rainy day fund: Everyone at some time in their life is going to have a rainy day. It could be a job loss, health issue, major repair to the house or car or another unforeseen circumstance that will need a large amount of money. Unless you plan for the unexpected, you could be significantly impaired financially.
- Keeping up with the Jones: Are you worried about keeping up with the neighbours and living in a house beyond your means, driving cars that are too expensive and spending way too much money to give the impression of having money? This is a recipe for financial disaster.
- Indulging adult children: Are you going into debt supporting adult children? Borrowing money or dipping into your retirement savings so your kids can buy a house? Love your children, but don’t go into debt for them.
Money management mistakes: We can correct your worst money mistakes
If you’ve already fallen victim to any of these money mistakes, it’s time for professional help now. Ira Smith Trustee & Receiver Inc. has helped people just like you in the Greater Toronto Area (GTA) for many years. Starting Over, Starting Now, we can help you overcome your financially difficulties. Contact us today.