We all want to get rich, richer, richest and stay there our whole life.
But, how many of the common people actually manage to get rich?
Before we come to the answer of this question, let us understand what exactly is being rich.
An individual who has more money and hence assets, which are much more than he needs or will ever need is a rich person. This implies that a person who needs not more than ₹50,000 but has a monthly income of ₹100,000 per month for his needs has over ₹10,000,000 worth in bank balance and assets is a rich person. On the other hand, an individual whose monthly expenditures are in excess of ₹100,000 but has no savings or any worthy assets is poor actually. Hence, richness is actually a relative measure of wealth.
Now coming back to our question, the answer is only a handful in entire India. But, why? Because the rest of us make mistakes with the handling of our income.
Actually, we all make mistakes in life and making financial mistake is one among them. Sometimes, a single money mistake can cost you much and can be the barrier to achieving your financial goals.
Let us have a look at the top 5 money mistakes that keep you away from becoming rich.
Top 5 Money Mistakes
1. Spending More than you Earn:
It is one of the most common financial mistakes which most of us do. If one would consider this point he/she will never get into financial crisis.
Generally, most of us spend much without thinking about the future, and this is the biggest financial mistake one does. Using credit cards and loans is one of the factors which leads to overspending. This money mistake is simple enough to avoid.
Making a monthly budget as per your income and strictly following that can definitely help you avoid making this mistake. Include only necessary item in your budget and try to avoid the item for luxuries.
2. Not Having a Money Management Plan:
Planning is required for everything. And the same is required for your financial life. Having financial goals is the first step which leads you to financial successful life.
Your financial goals should include your children’s education plan, plan to buy your own property and planning for your retirement is a must.
So, set your goals, start saving and invest as per your plan to achieve your goals.
3. Buying Things you Don’t Need:
Many of us have a show-off nature. If my friend is having an expensive thing, then why can’t I? Many of us have this feeling after seeing some of the other things with our friends and close ones. To get a good impression and show it off, we buy even those things which are not required by us. This not only consumes our money but also affects your future financial life.
Remember your success and how happy you are matters the most. Wise people do not have to show it off, they focus on their requirements and happyness, not on the things which doesn’t matter.
Don’t try to create an impression in someone’s eyes, try to create a better life for you!
4. Not Trying to Increase your Income:
Increasing your income is the one most important thing which can make you rich. Switching your job and creating a second source of income are the best options to increase your income. But what happens with many of us is- they get comfortable in their life and work atmosphere and don’t want to take much risk and pressure. Hence, they continue with the same life, being in the same job. This way their income remains the same.
In terms to become rich, you need to get out of your comfort zone and start taking risks.
5. Relying on a Single Income
When you will go through the life of any well know rich person, you will get to know they never relied on a single source of income. They saved some from their usual source of income and used those savings initially to start their second source of income. You may think that all this is possible only for the businessmen.
But, it’s not true always, being a working professional you can also have a second source of income, you can start freelancing or taking some extra projects apart from your company. You may also start a side business which requires less monitoring so you can focus on that in your free time.
The above-mentioned points are the most common money mistake which one does. Try to avoid these and your changes will be soon reflected in your bank’s account.
Be wise! Set financial goals! Avoid making Mistakes!!