Whatever you may believe, making money in today’s world is always possible with a little dedication. With a little bit of ingenuity and hard labor, anybody can earn enough to afford the basic essentials in life. Making money is not the problem — keeping it is where things get a bit tricky.
Have you ever noticed that your pleasantly impressive paycheck thaws into meager scraps mere days after you receive it, and you haven’t the slightest idea where those dollars go? If the answer is yes, this article is for you. Let’s take a look at what causes your expenses to grow and how to improve the situation.
1. You Don’t Use Discounts
There are saving enthusiasts who claim that systematic use of loyalty cards, promotional events, coupons, and periodic discounts can save you thousands of dollars every year. You may find entire manuals on how to do this online. While these guides can be completely legit, keeping track of promotions and cutting coupons may be tiresome and time-consuming. An interesting alternative is the Slimcard — a card that can be used instead of all loyalty cards, in any country, for any transaction.
2. Your Business Doesn’t Have A Financial Plan
If you run a business, a lot of your expenses may be boiled down to inefficiencies and poor organization. There is, unfortunately, no quick and easy solution to this problem. The answer is to create an effective financial business plan on your own or hire a specialist to do it in your stead. Once you do it, you will be amazed at how you managed to get any profit out of your business at all before.
3. You Buy Things You Don’t Really Need
Let’s be honest: we all buy a lot of unnecessary things — things we don’t need or things no sane individual may ever need. Sometimes we buy something because we feel we absolutely must have it right away, but soon it gathers dust somewhere in the farthest confines of the attic.
How to distinguish the things you need from the things you will be embarrassed to have in your possession a couple of years later? A good rule of the thumb is to give yourself time to think every time you encounter something you crave to buy. Don’t buy something on an impulse. Give yourself three days and if you still want it, well, go ahead. But, more often than not, this time is more than enough to let the impulse fade and move on.
4. You Lend Money
Old Polonius knew what he was talking about when he advised his hot-headed son against both borrowing and lending money — neither is good for you. When you lend money, even to a good friend and seemingly reliable person, you have no guarantee you’ll ever see this money again. A borrower may request more money later or tell others about how easy it is to get cash from you. This may lead to more lending and, eventually, spoil your relationships with other people.
5. You Lack General Financial Literacy
However jarring the idea may be, it’s important to consider that your problem may be rooted in the fact that you simply don’t understand some very basic and fundamental things about how money works. If words like interest rates, inflation, return on investment, and so on mean little to nothing to you, it may be an extremely good idea to get some basic financial education as soon as possible. You won’t believe how much more sense the world starts to make when you understand how money actually works.
These are some very basic but still very important things that may cause your expenses to be unnecessarily high. Take a good look at them and ask yourself if any of these things relate to your situation.
Featured photo credit: 401(K) 2012 via flickr.com