Mistakes to Avoid While Building Wealth

My dad always uses the quote; “When your income exceeds your outgo, your upkeep will be your downfall”.

That simply means if you spend more income than you earn, you won’t be able to keep up and inevitably fail.

This is just common sense and money isn’t a complicated subject. Sometimes we just need to weed out the non-essentials, and listen to our own instincts, so can become financially successful.

Here are a few important mistakes to avoid when building wealth and saving for your future:

Spending everything you make, and more.

This is a basic law of money, that even our government still doesn’t understand. Don’t outspend your income and make small sacrifices daily to reap future rewards. Creating a budget can be as detailed or simple as you want it, you just need a basic plan that expresses your goals. Learn to spend your money, otherwise it spends you.

Being lazy with your money

Handling finances properly takes knowledge, discipline and application. But making a small investment now will pay off when you find peace and get complete control over your money.

Borrowing money for things you can’t afford

Anytime you borrow money, it’s because you can’t afford that item (if you could afford it, you wouldn’t be borrowing). No matter how you try to spin it, that’s the basic fact. I’m not opposed to debt, but in general it’s very dangerous and should be thought about carefully.

Believing you are a failure

Your lack of knowledge about money doesn’t make you a failure. You have the power to change your situation, it’s all about your attitude. Knowledge is power!

Using money to fill an emotional void

“Money doesn’t buy happiness” is still a very true statement. Shopping your way into anything won’t deal with the real problem, the spending is just a symptom of something else.

By following simple rules and staying disciplined, you can build wealth and avoid most pitfalls. However, if you want to be poor, and never build wealth, feel free to enact any of the bullet points outlined here!

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