Biggest money mistakes you can make

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There’s a great article in the Sydney Morning Herald headed “The Five Biggest Money Mistakes”.  It is worth reading.

But wait there’s more …

Here are five (5) more

Be aware that this is by no means an exhaustive list.  I could go on, … and on!

1. Not seeking or heeding professional advice

Listening to hot tips and gratuitous advice from untrained people can be a dangerous pastime when it comes to your finances.  Family and friends can be well meaning but unless they are trained, the advice can be wrong.  A hot share tip is like a hot racing tip.  It is speculative and super risky.  Remember that not all who purport to be friends have your best financial interest at heart.

2. Living beyond your means

If you don’t have the money you shouldn’t incur the expense.  Reliance on a credit card to finance a shortfall is stupidity.  A credit card is not your money.  It is high interest personal debt you can’t afford.  That is the worst debt of all.  If you couldn’t afford the original amount, you are not going to be able to afford the debt plus high interest

3. No emergency money

When you live from week to week there is no margin for error and no room for something going wrong.  An emergency may be as simple as the fridge or car breaking down.  If you have to turn to a credit card to fund the repair or replacement, imagine what you would do if you were without income because you couldn’t work for a few weeks or a few months.

4. Misuse of dual salaries

It used to be case that the second income into the household was committed straight to savings.  Many people now foolishly commit all of their money to a lifestyle based on the notion dual incomes lasting forever.  Use the second salary for something that will enhance your finances, not simply enhance your retail therapy opportunities.

5. Believing that employment income is all there is

Income is king and earning power is unlimited.  Most people are content to get a job and then leave their financial future in the hands of their boss.  That is financial laziness.  You shouldn’t be reliant on bonuses and wage rises.  There are many ways to earn additional income and anyone can do it.

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Make money work for you in 2011 – get your money hat on!

Gary Weigh making money work for you

In my experience, the majority of people have some seriously bad attitude to money; rich and poor alike.  Socio-economic group makes little difference.  It just makes it easier to predict what the specific problem is likely to be.  To help you make money work for you in 2011, here are my top ten (10) money symptoms.  Are you on this list?

1.      Don’t have enough to survive or thrive

2.      Enough to thrive but not enough to keep up with the Jones’s

3.      Have more than enough to keep up with the Jones’s & now messing with Jones’s heads

4.      Obsessed with hoarding money

5.      Obsessed with spending money

6.      Have money but still not happy

7.      In rampant debt by spending more than you earn

8.      Won’t save but must purchase now

9.      Money dysfunctional (e.g. addicted to gambling)

10.  Aversion to any form of investment or management

The root problem is focusing on money as an end, not a means.  Focusing on money as and end in itself rather than a means is a negative mindset.  This negative mindset can create a preoccupation with lack, overabundance, hoarding and over-spending,

The answer is to maintain a calm and optimistic mind towards money.  And never (never, never) focus on money as the source of your problems.

Make no mistake!  You are the cause of your financial problems.  You put yourself in the position you are in and the key to making it better is already in your hands.  You simply choose not to use it.

It sounds harsh and unfair, I know.   But sugar coating the truth won’t help you.

If you want to take the first steps to make money work for you and your family in 2011, try this:

  • Stop taking financial advice from your family and friends
  • Seek financial advice from a reputable professional and don’t focus on the cost
  • Stop comparing yourself and your financial situation to others
  • Focus on goals and positive action, not on money; money follows positive action
  • Stop including Centrelink as a significant part of your New Year financial strategy.  It is a backstop institution, not a mainstream funding source

Your financial situation is a reflection of your state of mind.  If your mind is stressed, distracted, angry, jealous or resentful, your finances will reflect the negative energy you generate.

So try some positive thoughts followed by some positive action.  And don’t slip back into your old way of thinking just because your plan hasn’t worked after one week.

Until next time!


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