In today’s times, it is important for each and everyone to plan their finances and investments for living a happy life. Most people are too busy to spend time on planning their finances and often are short of money even though they work hard and save money. They make the following mistakes:
- Not Tracking Expenses: Do you always wonder “Where did my salary go ? “. If you are asking this, then you are surely not tracking your expenses. Maintain a diary and record each and every expense you make. This itself will make you conscious of your mistakes and help you spend wisely.
- Spending First, Investing Later !: If you always complain that you have no money left for saving, then follow the simple rule “Invest first, Spend Later”. You will be forced to manage your expenses due to this. Try investing in SIP (Systematic Investment Plan)
- Planning Taxes in the Last Moment: Always plan your taxes at the start of the year. Never leave tax planning at the end of year as this will cause you to cut corners and won’t give you ideal tax planning. Invest in insurance and other schemes wherein you can claim income tax rebates and minimise tax burden.
- Not Making Goal based Plans: If you don’t know where are you going, then it doesn’t matter which road you are walking. Does this make sense to you ? Always have a goal. Remember, you must always form a realistic goal and work towards achieving it. Your finances will automatically get planned accordingly. So make a list of short-term, mid-term and long-term goals and plan your finances accordingly.
- Not Planning for Emergencies: Every human in this world is subject to uncertainties of all kinds. To deal with any emergency situation, you should keep an emergency fund aside. Otherwise you will tap your long term savings and thereby impact your investments meant for your retirement.