Money is a legal tender which we use in exchange for goods and services. Making money is not as easy as it seems but spending it does not take any or much effort. Money acquired over a long period, say like 26 years can be spent or lost in a day. In order not to lose monies, here are some common mistakes that we make in money management.

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1. Not using cheaper services

Most of the services we carry out with traditional banks are now carried out by online banks. However, the online banking platforms are often more affordable. You only have to make sure you use a reliable online bank. You can read a list of financial service companies UK reviews on Britainreviews.co.uk to know reliable online banks you can patronize.

2. Unending payments of bills

We run a system where we have to pay for everything we use. From paying for water to paying of light to cable television e.t.c. Most times, we do not maximize the usage of the facilities if they are paid for. For instance, when we subscribe for cable television, we are out of the house for the better part of the day and no one is enjoying the service. By paying only bills we need and use, we can save a lot of money.

3. Borrowing money to buy a new car.

Borrowing money to buy a new car is one of the mistakes that most people make in money management. Buying a new car of course is a good thing and a thing of joy. But when you have to borrow money with interest just to buy an asset that easily depreciates is not advisable.

4. Using your credit card to shop

Most people enjoy shopping with their credit cards not knowing that it is a mistake of finance management. Every cent on a credit card usage comes with an interest. Whenever you shop for groceries or clothes using your credit card, just know that you are paying an additional cost on whatever you purchased.

5. Spending too much or spending extravagantly

The cents we spend buying some unnecessary things can be saved which will later turn up to be a chunk if one continues. Extravagant spending lifestyle is a waste of money which is another mistake that people make.

6. Not making Investment

Not investing is another major finance mistake that people make. One can start an investment with any amount of money no matter how little. One of the good things with investment is that your money keeps working for you and yielding returns which most times does not require your time or extra energy but also ensure you do your thorough research on your intended investment so that you do not run at a loss in the end.

7. Not making an adequate plan

Not planning adequately or not making plans at all is another mistake when it comes to financing management. The monies one could easily use to achieve so many things could be spent irrelevantly without achieving anything if plans on how to spend or manage your finance are not made appropriately.

8. Using your savings to pay off debt

Most people make this mistake of using their savings to pay off debt. No matter how little, there is some credit interest paid on savings. By the time you use your savings plus accrued interest to pay off debt, then you will have to start all over again to start saving which is actually not easy and it will also take a little time for one to get a reasonable interest rate on the savings. It is therefore advisable not to use your savings to pay off debts.

Generally, some of these mistakes we make are not consciously, but now that we know, we have to make conscious efforts to consider how we manage our finance in order not to keep on with such mistakes. There are also other mistakes which are not mentioned here.

Common mistakes that we make in our money management