6 Money Mistakes Everyone Makes

Providing for others when you are lacking yourself, overindulging in social activities, and ignoring debts are all reasons why you are always broke.

Everyone makes financial mistakes. The important thing is to learn from them so you don’t repeat them in the future. Here are the 6 worst money habits that most people are guilty of.

1. Provide for others when you are not well off

In many families, children are responsible for providing for their parents financially. It is a nice gesture, but you should still think carefully about how much you spend.

The rule is to leave enough money to cover your living expenses and to save for the future. Remember, you have to take care of yourself before you can help others.

2. Going to college without a specific plan

We are all taught that college is the safest path to success. But the truth is that many graduates are unemployed with huge student debt.

Not all fields require a college degree. If you feel that college is not necessary for your future path, do not limit yourself. You can still succeed by gaining experience and learning outside of school, instead of chasing after degrees.

3. Invest in housing

A home is a place to live and not a safe investment. You may hear that someone is selling a house for a great price, but don’t forget that they also spend a lot of money on maintenance and repairs.

If you are thinking about settling down, calculate the cost of owning a home. Only then can you decide whether to buy or rent.

4. Overindulgence

It's hard to say no to a fun party, but if you keep saying yes to every invitation, you'll soon go bankrupt.

Exciting experiences are a part of life, but you have to make sure you’re spending money on something that really matters. Many people who appear to be well off by posting pictures of their vacations or buying luxury goods on social media have actually struggled to save enough money to afford it.

5. Ignore debt

Many people ignore overdue bills. This only adds to the debt and affects your chances of getting approved for future loans. Worse, you could be sued.

The solution is if you can't pay your bills on time, call your lender and explain to them that you really want to pay. This way they may be able to give you some flexibility.

6. Withdrawing money from your retirement account too early

Opening a retirement account when you are young is a wise decision. But if you withdraw money from it and spend it on unnecessary things, it is a mistake. Then you lose both money and interest.

You can withdraw money for legitimate reasons such as investing in education or in case of disability. But think carefully before deciding.

Here are six ways to fix the above mistakes:

- Track income and expenditure

- Adjust spending appropriately

- Don't try to ignore debts

- Save

- Open a pension account

- And don't copy the bragging photos on social networks.

According to VNE