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10 Signs You’re Committing Financial Suicide Though You Don’t Feel You Are

10 Signs You’re Committing Financial Suicide Though You Don’t Feel You Are

Being able to properly handle your finances is one of the things that proves that you are a mature person. This is easier said than done, and even if you are in possession of some extra cash at the end of each month, it’s still not proof that you’re being responsible. In other words, simply not being irresponsible does not necessarily make you a prudent individual.

The act of financial suicide is not something that happens instantly, it is something you have plenty of time to back out from. Unfortunately, we can constantly see how people are either struggling with their finances, or how they ended up completely broke. When something like that happens, the blame is usually placed on the country’s economy, or on the tax system, etc. Although there is truth in that statement, it still does not completely justify one’s recklessness. If you are aware of the conditions you are living in, you need to work towards solutions, not excuses. Here are the most common mistakes people make that cause them to collapse financially.

1. You decide to have children, but you are financially unstable

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    If you plan on raising kids properly, you need to have financial stability, and enough time on your hands to do it properly. Without a stable financial state, you may be setting a bad role model for them. After all, the apple does not fall far from the tree, and financial suicide is likely to be inherited.

    Being able to provide for your child’s health care, clothing, education, and so on is not cheap (over a lifetime you may end up spending millions), but necessary for a brighter future. Take these expenses into consideration when you plan on raising children. If you truly want to have a healthy family, prioritize your career, and use your desire to allow your ambitions to properly bloom.

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    2. You are financially dependent on other people

    Our friends and family are always willing to help, however going through life as a charity case is definitely not the way to live. Everybody has his or her boiling point, and no one will tolerate your incompetence forever. Sooner or later, your relationship with your loved ones will get worse if you do not start doing something productive with your life.

    When you borrow money, do everything in your power not to get into the same situation again. Calculate how to lower your expenses, think about what you can do to earn some extra cash. To say it bluntly, you need to realize that you are in a serious problem.

    3. You start settling your debts by turning to money loans

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      Regardless of how difficult your financial situation is, you must never allow yourself to settle your debts by turning to payday loan companies. These are just seemingly easy solutions, meant to lure you in and deplete your finances faster than you think. These companies are very widespread and they are extremely profitable. If you want to get out of debt, this is not a solution – you will only end up owing more money. Any financial adviser will tell you the same thing. These are just quick solutions that sound appealing in order to masquerade the intentions of completely draining your budget. Settle your debts by using any other alternative.

      4. You rely on bank credit all the time

      Another form of financial irresponsibility is constantly relying on bank credit. We hear stories all the time about how people are barely making ends meet, so they are waiting for their credit to be approved, so they are basically always in the red. The problem is the unpredictable future: if you are constantly tapping into your cash reserves, you are completely defenseless. What if something happens that throws your living situation out of balance? You will have no efficient solution, and it’s all downhill from that moment forth.

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      To avoid this, start living more modestly. Focus your efforts to return to a balanced budget, and consider all the possible options for earning a little extra. Ask your employer if there are more responsibilities that you can take on and be financially compensated for. Restoring your emergency fund is of utmost importance.

      5. You frequently gamble (or gamble large amounts of money)

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        Gambling in casinos, playing the lottery, and placing bets on sports games can be extremely addictive. When there is enough money in your budget, starting to place bets for the sake of earning a little extra is a terrible decision. Winning is far from impossible in these cases, but as mentioned, the problem lies in losing control. It is still unclear whether gambling should be defined as addiction or compulsion, one thing is certain however – people tend to use it as an escape mechanism, to relieve themselves from the anxiety, or to get their dose of adrenalin rush. Eventually, the condition takes over to the point where you are no longer concerned with the consequences.

        Whenever you think about gambling, put all the money you would invest in a piggy bank. Gradually, you will accumulate a handsome bank deposit that you can place in your local bank and allow it to grow.

        6. You are negligent towards office equipment

        This mostly applies to business owners. It is extremely difficult to balance your priorities, but still, your future and your business’s well being depends on the quality of your service. Always make sure everything is functioning properly, otherwise the whole situation can be followed be an unfortunate turn of events – also known as financial suicide.

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        Computers need to be maintained and function properly. Office printers do not last forever and you need to know when they might need a replacement. Headphone sets, cables and every minor detail that may seem unimportant need to be fully functional or they may harm your professional image. In this world, appearances and first impressions matter, so always strive to be at your best.

        7. Choosing the wrong/luxurious home

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          Living in a place you cannot afford, or living in an inconvenient location, is one of the most common causes for financial suicide. If you need to commute a lot in order to work on a daily basis you are likely to encounter problems with budget. Luckily this is a manageable issue, carpooling and saving money on gas is one of the best solutions.

          Much larger problems occur when you take a bigger bite than you can chew, or to be more precise, buy an expensive house without enough support. This kind of costly lifestyle will have a troublesome aftermath. Honestly, if you are not completely certain you can afford something, chances are you probably can’t. Opt for a home that you can afford one hundred percent – even if you are hoping to use it as an investment.

          8. You spend more than you earn on a monthly basis

          This is a very common trait in people who are newly employed. During payday week, they live like royalty, and for the rest of the month, they adopt a lifestyle similar to hermits. You may not have serious troubles with maxed out credit or loans, but you are still not making good use of what could be a very lucrative setup in future.

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          Know your limitations, calculate your expenses, and at the end of the month, treat yourself with something – but at the same time, avoid straining your budget. Work towards creating a solid nest egg and securing a more stable future.

          9. You are not planning your future

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            Responsibility merits healthy ambition, realistic goals, and always thinking ahead. Living in the moment is for high school kids and college students. With that kind of mindset, reality is bound to hit you hard. Spending cash and enjoying life is what people usually do during a summer break, since doing it throughout a whole year will leave you broke.

            Do not be satisfied with your life for too long. Too much hedonism is toxic for your future. Take time to enjoy, but never forget to push yourself and make endeavors, for the sake of progression. Organize your life, set goals and objectives, and devise strategies on how to realize them. It is imperative that you devote at least two hours of your day time working towards these achievements. Even failing is not a complete waste of time and money, as long as you have gained something valuable that you can implement in the future.

            10. You are lazy

            If you are done with your work and you go home and you have no other responsibilities, then you are lazy. It may seem like a strange definition, but it is true. It means that you have at least 5 hours of productive time and you decide there is nothing that you can do. Lazy does not necessarily mean you are lying around doing nothing, it also means you have a mortifying lack of ambition. In other words, not working towards increasing your budget means you are working against it, and once again, a step closer to financial suicide.

            When you are blessed with enough free time, do not let it go to waste, learn to invest it into something that can be lucrative. Even taking up a hobby can be a judicious investment, as long as there is someone who will appreciate your work.

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            Djordje Todorovic

            Blogger, Gamer Extraordinaire

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            Published on September 17, 2018

            How Being Smart With Your Money Leads to Financial Success

            How Being Smart With Your Money Leads to Financial Success

            Achieving financial success is not something that just happens. Maybe if you win the lottery or something, but for the average person like you or me, it comes from a series of small steps you take over a long period of time.

            With each step, you form a new smart money habit. And with each smart money habit, you build towards financial independence.

            So what sort of habits can you form to get on that path? Let’s take a look at smart money habits you can start today to get you closer to a financially independent future.

            1. Avoid being “penny wise but pound foolish”

            It’s tempting to try saving a couple cents here and there when buying small items. However, that’s not where the real money is saved. You’re putting in extra effort for something that doesn’t move the needle.

            You get the most bang when you’re able to cut down on your bigger bills. For example, finding a lower interest rate for your mortgage could save you $50+ per month. And cutting your transportation bill by purchasing a cheaper car or taking public transportation can provide large gains as well.

            So, look at your recurring expenses such as housing, transportation, and insurance, and see where there’s wiggle room. It’s a much better use of your time than trying to pinch pennies here and there on smaller purchases.

            2. When you want something big, wait

            Impulsivity can get you in trouble in most aspects of life. Finances are no different.

            It’s human nature to see something and want it right then and there. It starts as a kid in the checkout line at the grocery store, and it continues on through adulthood.

            We get an idea in our head of something we want, and it’s hard not to go out and get it right then.

            A good example is wanting a new car. Perhaps you’ve had your car for several years. It’s crossed the 100k mile mark. Maybe maintenance is due, and you’re annoyed that you need to replace the timing belt or purchase new tires.

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            So, you get the itch.

            You start digging around online, and you realize you could trade in your current car for something newer and more exciting… all for a few hundred bucks a month. Then you get obsessed.

            Here’s where you have to take a step back.

            Your newfound obsession is clouding your judgement. Rather than giving into the impulse, wait it out.

            Set a timeframe for yourself. Maybe you come back to the decision three months down the road. See if the obsession lasts.

            It might, but often, a funny thing happens. Often, you forget about it. And often, you find that the new car wasn’t a need at all.

            The impulse faded. And you just saved yourself a ton of money.

            3. Live smaller than you can afford

            You finally get that big raise. And you want to celebrate – and why not?

            You’ve been looking forward to this forever. And after all, it was all due to your hard work.

            That’s fine, splurge a little. However, make it a one-time deal and be done.

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            Don’t get caught in the trap that just because you’re now making more money, you should spend more.

            Too often, people get more money and feel like they that gives them the means to buy a bigger house, a bigger car… you know the drill. Resist.

            The fact is that living smaller than what you can afford is one of the fastest ways to build savings.

            But if you constantly upgrade as you begin to make more, then you’ll never get ahead. You’ll just build up more debt along the way and have just as little wiggle room as before.

            4. Practice smart grocery shopping

            Food… it’s one of the biggest portions of any budget. And if you’re not careful, it can be one of the biggest drains on your wallet.

            But luckily, there are a few things you can do to ensure that you stay smart with your money when buying groceries.

            Create a grocery budget

            Set a strict weekly grocery budget. When you know how much you can spend on groceries, you can then plan your weekly menu around it.

            Once you know what all you need, you can go shopping and keep a running tally as you shop to ensure you’re on track.

            I tend to do this in my head, rounding for each item. However, writing it down as you go would probably work best for most people.

            Make a list… and never deviate

            Never go to the grocery store without a list. If you go to the store with a ballpark idea in mind, you don’t have a true ide of what you need.

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            You’re not well-researched. You don’t know what the sales are. As a result, you’re going to make decisions on the fly.

            These impulse decisions will lead to overspending, which will derail your grocery budget.

            Eat before going grocery shopping

            It’s also important to eat prior to going to the grocery store. Hunger is a powerful force.

            If you’re shopping on an empty stomach, everything is going to look good. In particular, you may find a lot of ready-made, processed snacks will look enticing.

            After all, you’re hungry now and that food is easily available. So subconsciously, you may lean towards those items.

            Unfortunately, not only are those items typically less healthy, but they’re likely more expensive. You pay for convenience.

            However, when you eat prior to shopping, then you’ll shop with a clear mind. Your hunger won’t cloud your judgement, influencing you to make poor decisions like a cartoon devil resting on your shoulder whispering in your ear.

            This makes it much easier to stick to your grocery plan.

            5. Cancel your gym membership

            Now that you’re all set on your food, it’s time to get smart about managing your budget in terms of physical fitness. And let’s begin by avoiding the gym. The gym bill, that is.

            The average gym membership costs around $60 per month. That’s $720 a year.

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            Yet, two out of three gym memberships go unused. That means two-thirds of people who have a gym membership are literally giving away almost a thousand bucks a year. It’s crazy!

            I recommend seeking an alternative. One good alternative is to look into fitness streaming services.

            Streaming services allow you to stream hundreds of workouts like Insanity and p90x, right in your own home for around $10-20 a month. That’s $40-50 less a month than the average gym membership.

            Of course, then there’s the free option. The internet is full of free workouts that you can do on your own with minimal or no equipment.

            For example, there’s the Couch to 5K program, that I personally used a decade ago to ease myself from couch potato to running my first 5K race. If I could do it, anyone could.

            Then there are free resources like reddit that have limitless information on workouts. The Fitness subreddit has done all the research for you, populating workout tips and detailed workout routines for anyone to use in their wiki.

            There are several routines that require no equipment. And you can join in on the subreddit to become part of the community, making it easier for those seeking comraderie and encouragement in their fitness goals. All for free.

            It’s baby steps… And baby steps can start now!

            I’ve never met anyone that can’t stand to be a bit smarter with their money. And on the flip side, anyone can get smarter with their money. But remember, it doesn’t happen all at once.

            Begin by fighting your impulses. Prepare for the week and be smart at the store. And cut monthly expenses like gym memberships that are overpriced and you probably aren’t getting your money’s worth out of anyway.

            The devil is in the details. And the details can change your lifestyle and prep you for a financially independent future.

            Featured photo credit: Unsplash via unsplash.com

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