4 COMMON MISTAKES PEOPLE MADE WITH THEIR FINANCES IN THE PAST YEARS - page 4.

Gormicsta

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Quote from: Queentoshi on January 06, 2024, 10:21:56 AM

Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

1. NOT HAVING AN EMERGENCY FUND

2. NOT INVESTING

3. OVERSPENDING

4. NOT TRACKING EXPENSES

The thing is that some of these things are no mistakes, but situations that were difficult for some people to control because at the start of last year 2023, they planned to have emergency funds, to invest, not to overspend, and to track expenses, but it did not work out for them because of how poor their economy is, they are not earning enough to even spare some for emergencies and also investments and then try not to overspend but due to the ever increasing price of things in the market they keep spending more than their budgets and then they have also stopped tracking their expenses because tracking their expenses makes them depressed seeing that they are spending more money than they are earning and balancing the rest up with debt. The situation of things is really very difficult for some people in some places, and due to that, this year may be a repeat of last year.

That is accurate, and it's also a very crucial point: saving and investing can be challenging for some people due to external variables like the state of the economy. Sometimes having the ability to make the proper decisions is more important than just knowing what to do. Finding yourself unable to achieve your financial objectives due to events beyond of your control can be extremely depressing. So, do you personally believe that there are any approaches or techniques that could be able to assist those who are in this kind of situation?

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Quote from: icalical on January 05, 2024, 07:55:06 AM

Among those 4 points, many of the people I know skip the first point, they have little to no emergency fund, most of them are employee with fixed monthly salary, they are living healthy life, they think they will not need any emergency fund. Then Covid hit, companies are laying-off their employee, some of them living from their small saving. This makes them realized that no-one is safe and everyone needs emergency fund.

Very true. The importance of an emergency fund can be understood when any emergency situation arises, and the biggest example is the time of Covid. People are most carefree when they are happy. Because there are no bad situations during those times, people don't think much about the bad times that may come in their life. Everyone should really think that time does not always pass in the same way, situations sometimes teach people hard reality.

I have seen how people are struggling to survive after job loss, because they have no second option except job, and they don't have money to start anything new, and that's why having an emergency fund is at least a new one. They could start something and try to live better.

Gormicsta

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Quote from: |MINER| on January 06, 2024, 08:57:43 AM

Every person should have an emergency fund. It is not possible to say how danger comes in human life. Accident, job loss, family crisis can cause various problems. There should always be an emergency fund for this. All expenses should be settled and invested. If money is wasted, it will be spent. Investing has a saved money. Luxury can never bring good things. You should keep calculating all the time. If you spend more, you have to pay for it in the future. And you should keep an account of where you are spending. Then you will have an accurate account of your money.

You raise some excellent suggestions about the value of having an emergency fund and the necessity of keeping a close eye on your spending. I really like your point about how important it is to be ready for the unexpected. Emergencies like as accidents, job loss, and family difficulties can all occur, and having an emergency fund on hand will lessen the financial strain that may accompany them. Regarding the significance of investing your money, even if it's a little sum, I also think you make a lot of sense.

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Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

1. NOT HAVING AN EMERGENCY FUND

2. NOT INVESTING

3. OVERSPENDING

4. NOT TRACKING EXPENSES

The thing is that some of these things are no mistakes, but situations that were difficult for some people to control because at the start of last year 2023, they planned to have emergency funds, to invest, not to overspend, and to track expenses, but it did not work out for them because of how poor their economy is, they are not earning enough to even spare some for emergencies and also investments and then try not to overspend but due to the ever increasing price of things in the market they keep spending more than their budgets and then they have also stopped tracking their expenses because tracking their expenses makes them depressed seeing that they are spending more money than they are earning and balancing the rest up with debt. The situation of things is really very difficult for some people in some places, and due to that, this year may be a repeat of last year.

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Every person should have an emergency fund. It is not possible to say how danger comes in human life. Accident, job loss, family crisis can cause various problems. There should always be an emergency fund for this. All expenses should be settled and invested. If money is wasted, it will be spent. Investing has a saved money. Luxury can never bring good things. You should keep calculating all the time. If you spend more, you have to pay for it in the future. And you should keep an account of where you are spending. Then you will have an accurate account of your money.

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Quote from: blockman on January 06, 2024, 08:14:23 AM

Quote from: Gormicsta on January 06, 2024, 06:46:18 AM

Quote from: blockman on January 06, 2024, 04:20:14 AM

I don't track my expenses and I admit that is a mistake that I've been doing but that's not to the point that has made me broke. I can say that I know myself and I'm still responsible when its come to my expenses and finances. One another thing that I see with others mistake is that this is related to investing and what they do is they save to save and not save to invest. It's hard to invest when you don't have the idea on what type of risk tolerance you have but that's for each of us as an individual to figure out. Those savings that we have is much better be kept to investments that we know especially from most of us here, with Bitcoin.

There is a distinction between investing and saving, and some individuals may not be aware that investing is something they should consider if they want to increase their wealth over time. Those are some really intriguing points.

Saving money alone won't cut it; you also need to invest it to get returns by buying stocks, bonds, and yes, even Bitcoin. I appreciate that you emphasize the need of understanding your personal risk tolerance because it's a crucial consideration when making investments. It involves striking the ideal ratio between profit and risk.

Don't mention it because that's what I see in today's generation especially in my country. People think that when you save money, that's it and you don't need to do anything with the money and what matters is that you are seeing good numbers on your bank account. But they don't understand that it is going to be there and will just be taken over by the inflation and if they are not going to put it somewhere else and take a risk, it won't grow. So, with that situation, no matter what they do is that they're going to lose so before losing, why not just take the risk and have that chance of growing it over time with a good investment or asset like the ones you've mentioned right or any investment that they know and aware of.

They are indeed hoarding tons of cash into their bank account without even realizing that inflation could hit up 2-3% per year on which it do really just simply shows that fiat money is devaluing but for those people who do have that knowledge when it comes to investment and businesses on which they do really be able to patch up those inflation effect and this is something that i can say that it would really be that a wise decision
that had been made by a certain individual. Dont store up money on your bank but it would be better that you should really be letting it roll on other via means.
Success cant really be able to achieve if you do really just simply make yourself that not making any actions and really just sitting idle and trying to play out safe without even thinking
that you are basically just losing money overtime when it comes literally into its value.

People wont learn if they wont really be able to experience those mistakes but its true that its not needed for us to commit mistakes first before we would really be able to learn.
We can actually be able to read up someones experiences and decisions in life on which we could also reflect into ours on which i could say that it would
really be something viable and much worth i should say.

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Quote from: Gormicsta on January 06, 2024, 06:46:18 AM

Quote from: blockman on January 06, 2024, 04:20:14 AM

I don't track my expenses and I admit that is a mistake that I've been doing but that's not to the point that has made me broke. I can say that I know myself and I'm still responsible when its come to my expenses and finances. One another thing that I see with others mistake is that this is related to investing and what they do is they save to save and not save to invest. It's hard to invest when you don't have the idea on what type of risk tolerance you have but that's for each of us as an individual to figure out. Those savings that we have is much better be kept to investments that we know especially from most of us here, with Bitcoin.

There is a distinction between investing and saving, and some individuals may not be aware that investing is something they should consider if they want to increase their wealth over time. Those are some really intriguing points.

Saving money alone won't cut it; you also need to invest it to get returns by buying stocks, bonds, and yes, even Bitcoin. I appreciate that you emphasize the need of understanding your personal risk tolerance because it's a crucial consideration when making investments. It involves striking the ideal ratio between profit and risk.

Don't mention it because that's what I see in today's generation especially in my country. People think that when you save money, that's it and you don't need to do anything with the money and what matters is that you are seeing good numbers on your bank account. But they don't understand that it is going to be there and will just be taken over by the inflation and if they are not going to put it somewhere else and take a risk, it won't grow. So, with that situation, no matter what they do is that they're going to lose so before losing, why not just take the risk and have that chance of growing it over time with a good investment or asset like the ones you've mentioned right or any investment that they know and aware of.

Gormicsta

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Quote from: DabsPoorVersion on January 06, 2024, 06:49:56 AM

Quote from: m2017 on January 06, 2024, 04:48:04 AM

Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

Not having an emergency fund was one of the greatest financial mistakes people made last year.

For most people, this is a financial mistake not only for the past year, but for almost all the years of their life.

This is true. But we should also consider the fact like those people are unable to have an emergency fund because they don't earn enough to provide for their daily needs in life.

Regardless of how much or how little your income is, I'll say having an emergency fund is very compulsory, even if you'll have to cut out or cut down a few expenses in order to meet up with your savings or emergency fund.

The same way you don't need to earn so much before you can use the DCA technique to accumulate bitcoin or grow your investment, so is it when it comes to gradually piling up some funds for future emergencies. So yes, even if your earnings are very little, you could still stack up some money for the future .

Quote from: xSkylarx on January 06, 2024, 06:58:52 AM

Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

1. NOT HAVING AN EMERGENCY FUND
2. NOT INVESTING

This really varies for some people because for others, their salary is just enough for their needs and there is no spare money for an emergency fund or investment. I myself am having a hard time doing this, but with proper budgeting and cutting some expenses, I will try to do it this year because last year I had a hard time doing it, so I do hope I can have an emergency fund because it is very difficult to have debt these days due to high interest.

You've made a pretty significant point here: when folks are just trying to make ends meet, it can be very difficult for them to invest money or save for an emergency fund. Even so, it's imperative that you make the effort, even if it's only a small amount at a time, despite how difficult it may be. Budgeting and cost-cutting are excellent ideas, in my opinion, and they can assist people in finding even a tiny sum of money to invest or put toward an emergency fund.

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Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

1. NOT HAVING AN EMERGENCY FUND
2. NOT INVESTING

This really varies for some people because for others, their salary is just enough for their needs and there is no spare money for an emergency fund or investment. I myself am having a hard time doing this, but with proper budgeting and cutting some expenses, I will try to do it this year because last year I had a hard time doing it, so I do hope I can have an emergency fund because it is very difficult to have debt these days due to high interest.

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Quote from: m2017 on January 06, 2024, 04:48:04 AM

Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

Not having an emergency fund was one of the greatest financial mistakes people made last year.

For most people, this is a financial mistake not only for the past year, but for almost all the years of their life.

This is true. But we should also consider the fact like those people are unable to have an emergency fund because they don't earn enough to provide for their daily needs in life.

Quote from: m2017 on January 06, 2024, 04:48:04 AM

Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

Having an emergency fund is crucial, and while many people made this error last year, they should not repeat it this year.

People will definitely repeat this mistake and will repeat it year after year. You'll see. This is the lot of the majority.

Well, it's difficult for people to suddenly start building an emergency fund due to various factors they need to consider. Unless they have enough money to cover their daily expenses and are committed to correcting past financial mistakes, it can be a challenging task.

Gormicsta

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Quote from: blockman on January 06, 2024, 04:20:14 AM

I don't track my expenses and I admit that is a mistake that I've been doing but that's not to the point that has made me broke. I can say that I know myself and I'm still responsible when its come to my expenses and finances. One another thing that I see with others mistake is that this is related to investing and what they do is they save to save and not save to invest. It's hard to invest when you don't have the idea on what type of risk tolerance you have but that's for each of us as an individual to figure out. Those savings that we have is much better be kept to investments that we know especially from most of us here, with Bitcoin.

There is a distinction between investing and saving, and some individuals may not be aware that investing is something they should consider if they want to increase their wealth over time. Those are some really intriguing points.

Saving money alone won't cut it; you also need to invest it to get returns by buying stocks, bonds, and yes, even Bitcoin. I appreciate that you emphasize the need of understanding your personal risk tolerance because it's a crucial consideration when making investments. It involves striking the ideal ratio between profit and risk.

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Quote from: Solosanz on January 05, 2024, 11:30:09 PM

Quote from: jrrsparkles on January 05, 2024, 12:16:20 PM

It doesn't matter how much they make, all that matters is how much that is left and if they have nothing left then they have to keep working to meet the needs of the next month and that is what is supposed to be called as modern-day slavery. Its our choice to make, how it is going to be but if I am picking I will choose the save and invest so that I have financial security as much backup plan and don't have to keep pushing myself hard.

US is best at everything, that is just an illusion/myth.

What would you prefer, whether your father left nothing for you or something to inherit?

I don't think it's an illusion/myth, you can find many articles or people will say that. It mostly because of culture, it's very popular for them to take a student loan because many people can't afford to pay education. They need to take it because you need to have a degree to get a good job.

So the cycle started when you was young, you're in debt, when you've get a job, you only work to pay off your debt.

I'm someone who adopt minimalist lifestyle, which mean I only buy important stuff that I need, then the rest of my money, I will save it.

It's my friends who live from paycheck to paycheck, it's their choice and their life. "We only live once, try everything because you when you die you can't brought your money with you" that what was they said.

The US is one of the countries where students spend more money on education which is a fact but it doesn't mean students get the best quality education or even there is equality in the education.

Student loan is a fact and they do it because that is what we were conditioned for, study hard, get a degree then go for a job then keep working until retirement then enjoy on the couch then we will never been able to see what these rich people are doing in their life.

We live once so we need to enjoy everything is something that keeps injected to people to keep their spending spree no matter how much their earnings graphe increase.

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Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

Not having an emergency fund was one of the greatest financial mistakes people made last year.

For most people, this is a financial mistake not only for the past year, but for almost all the years of their life.

Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

Having an emergency fund is crucial, and while many people made this error last year, they should not repeat it this year.

People will definitely repeat this mistake and will repeat it year after year. You'll see. This is the lot of the majority.

Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

People may ask, What is the appropriate amount to save?

The amount that remains if the next point of “OVERSPENDING” is eliminated.

Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

2. NOT INVESTING

There are questions about this point. The global financial market is at the stage of “overheating” and many predict the collapse of the global economy (with good reason), therefore, investing in traditional financial instruments is questionable. You can easily lose money, and in this case, it’s better to leave this money under your pillow.

Investing should bring profits, not losses. If you choose a good financial instrument for this, why not?

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I don't track my expenses and I admit that is a mistake that I've been doing but that's not to the point that has made me broke. I can say that I know myself and I'm still responsible when its come to my expenses and finances. One another thing that I see with others mistake is that this is related to investing and what they do is they save to save and not save to invest. It's hard to invest when you don't have the idea on what type of risk tolerance you have but that's for each of us as an individual to figure out. Those savings that we have is much better be kept to investments that we know especially from most of us here, with Bitcoin.

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Quote from: Poker Player on January 06, 2024, 12:18:25 AM

These are not bad tips, what is wrong is the order in which they are given and that they are incomplete. The first one should be to track your expenses, in addition to your income, that is to create a budget. This will help you not to overspend, and then you will be able to save for an emergency fund and then invest, although there would be an intermediate step which is to get rid of consumer debts.

For someone new, as I said, they are not bad, but for me, who has been interested in and practicing personal finance for years, they have basic errors.

You're not completely wrong, but I'd like to state that these points were not outlined in any specific order and I never said that was a comprehensive list, I'm fully aware that there are so many, I have failed to list as I only intended to outline just four that I believe are the primary and common mistakes majority of people make, so you'd be right to say it's an incomplete list or it's not orderly arranged. But it wasn't meant to be. Thanks anyways for your helpful observation. Wink

Quote from: franky1 on January 05, 2024, 11:47:31 AM

for those with an inability to successfully track spending, or constantly over spend..
.. dont wait until months-end to realise when things go wrong

That is a really crucial point! Maintaining your financial stability requires understanding your spending patterns and putting in place a system that works for you. Furthermore, it's far simpler to change direction when you see problems early on rather than waiting until the end of the month. Those who find it difficult to stick to a budget could find this technique to be quite helpful. Additionally, I believe it's fantastic that it can be customized so that users can arrange it to suit their particular needs.

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Quote from: bayu7adi on January 05, 2024, 10:21:58 AM

I believe that investing is not the root cause of someone's financial mistake. Investing is still a strategy that is not prioritized but we need it for future , or maybe end game. Even though many people make a lot of money, not everyone needs to invest... it depends on each person's financial situation. Blaming someone for failure just because they didn't invest is very wrong.

I prefer to call it "Mistakes in Investing" rather than what you mentioned, which is "Not investing." Even a professional can still be very wealthy with a high salary, even without investing. Maybe their assets come from just one source, but that source is substantial and could even surpass the income of someone who invests.

If they didn't invest yet yes, but if they do, it can be. It's because maybe they picked up a bad asset? And there are even some who picked up a good asset but can still lose their invested amounts. It's because they are impatient enough to HODL longer. Then they are weak in terms of emotion and mentality because they can get affected by the FUDS and other negativities easily. Investing is popular so it is actually being prioritized by the many.

But if we are struggling financially, then it's okay to not prioritized it. If someone is already making lots of money, investing may not be needed anymore. But there are still some who did it. They are only being careful. Blaming is wrong and what is more wrong is when they blame without knowing the background of that person they blame.

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These are not bad tips, what is wrong is the order in which they are given and that they are incomplete. The first one should be to track your expenses, in addition to your income, that is to create a budget. This will help you not to overspend, and then you will be able to save for an emergency fund and then invest, although there would be an intermediate step which is to get rid of consumer debts.

For someone new, as I said, they are not bad, but for me, who has been interested in and practicing personal finance for years, they have basic errors.

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Quote from: iv4n on January 05, 2024, 12:46:58 PM

Quote from: Gormicsta on January 05, 2024, 02:54:36 AM

1. NOT HAVING AN EMERGENCY FUND

2. NOT INVESTING

3. OVERSPENDING

4. NOT TRACKING EXPENSES

It's good to have an emergency fund, but without some nice income it's hard to put money on the side that can cover "saving & investing". Overspending is not something that we can control, especially if we need to take care of a family and maintain the household. Many things can happen all of a sudden that will take our money from the wallet. And this inflation is not helping, my salary hasn't gone up as much as the prices have gone up.

So, you have good points here, but without income, it's hard to do anything. And to get to nice income it's not so easy... some people get there, but some never do.

That's right, setting aside money as an investment or saving will be difficult if you don't have enough income, because many people who are already working earn income that is only enough to meet their daily needs, therefore they can't set aside money for it. saving especially for investment, also nowadays it is difficult to get a job with a good enough income, many unemployed people are going back and forth here and there looking for a decent job, even though sometimes they have to pay money up front as a sign of being able to enter and be able to join the company Of course this will actually increase their burden.

In my opinion, currently finding a job that has a good income is also difficult, because there are few jobs available, but on the other hand, now there is the internet which is developing rapidly, and I think they have to take advantage of this, especially with young people who tend not to be able to travel far. from cellphones and the internet, this can be used to make money gradually, because getting rich straight away is impossible, whatever you do you have to start with something small and then grow and make a profit.

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Quote from: jrrsparkles on January 05, 2024, 12:16:20 PM

It doesn't matter how much they make, all that matters is how much that is left and if they have nothing left then they have to keep working to meet the needs of the next month and that is what is supposed to be called as modern-day slavery. Its our choice to make, how it is going to be but if I am picking I will choose the save and invest so that I have financial security as much backup plan and don't have to keep pushing myself hard.

US is best at everything, that is just an illusion/myth.

What would you prefer, whether your father left nothing for you or something to inherit?

I don't think it's an illusion/myth, you can find many articles or people will say that. It mostly because of culture, it's very popular for them to take a student loan because many people can't afford to pay education. They need to take it because you need to have a degree to get a good job.

So the cycle started when you was young, you're in debt, when you've get a job, you only work to pay off your debt.

I'm someone who adopt minimalist lifestyle, which mean I only buy important stuff that I need, then the rest of my money, I will save it.

It's my friends who live from paycheck to paycheck, it's their choice and their life. "We only live once, try everything because you when you die you can't brought your money with you" that what was they said.

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In everything, an emergency fund is really necessary, because once your business fails or you lose your job, you will still have some money. So this is also number 1 for me if you have work or business. As for Investing, we can't blame others because most of them are afraid because the money they hold is something they worked for, so they are afraid to try something else because they might just fail.

Topic: 4 COMMON MISTAKES PEOPLE MADE WITH THEIR FINANCES IN THE PAST YEARS - page 4. (Read 757 times)