There are two kinds of people in this world those who increase their wealth
and those who never do and the truth is that keeping money is much more
complicated than earning it because of the constant financial blunders people
make therefore in this video i will share with you seven money mistakes you
must avoid at all cost stake number one taking a degree you will never use
gone are the days when academic degrees were essential to shine in the
professional world with the widespread accessibility of the internet readily
available educational resources and training programs becoming so common
people now have many options to succeed and it does not require graduating with
a fancy degree so if you've been wondering whether taking a degree to get
ahead in the working world is right for you then first consider the four
following pieces of sage advice first colleges do not teach you the
skills you'll need in the real world unfortunately higher education does not
adequately prepare you for the outside world you can only learn by doing not by
watching someone tell you how it's done next a university diploma or degree is
simply a piece of paper that confirms that you've achieved a certain level of
academic knowledge nonetheless what happens in class doesn't always
translate into the real world also nowadays having a university degree does
not grant guaranteed access to a job you need to bring skills that can be sold to
the market and the opportunity to continue to learn develop and deliver
employer value in fact these days many high earning jobs do not require
university degree nowadays there are various professions available that do
not require a shiny degree or diploma and these fields include video directing
graphic design and more now don't get me wrong i'm not using this video as a
platform to discourage people from going to school instead i'm trying to get you
to understand yourself and your goals therefore ask yourself why you want
higher education and if paying tens of thousands of dollars for school will
guarantee that job that you're aiming to land mistake number two lending money to
friends and family you may think that helping your broke friend is the right
thing to do but in fact it could be the event that completely ruins your
relationship if you're not convinced stick around in this video i'll share
with you six reasons why lending money to friends or family is a bad idea
firstly family and friends will probably come to you because they can't get a
loan from the bank and this means that traditional lenders believe that they
are too risky even after considering all potential interest options also most
loans to friends and family have very little or no interest but lending money
to a loved one you are taking enormous risks for a fraction of the amount a
bank would typically receive another consideration is that you will probably
never get a refund for the money you gave out of the loan people who borrow
money from friends or family never fully repay the loan therefore you might also
tell yourself that you gifted them money at a charity not alone as there's a good
chance that you'll never see that money again so only borrow as much as you want
to part with now most familiar loans involve parents lending money to their
adult children and it's true that sometimes the reason for the loan is
good such as a one-off emergency that was utterly unexpected however this is
generally not wise and such parents are simply rewarding bad financial habits if
your children think you will save them from every bad financial situation they
get into they will never be encouraged to develop good financial habits thus it
rarely ever works out when you lend money to a friend or relative
mistake number three not setting up a money saving system for some saving can
be elusive regardless of how often we hear that savings should be a permanent
part of our financial lifestyle there is always some emergency situation that
pops up and clears our savings account another issue that we deal with when
saving is just how much is enough and often the
avid saver will wonder if he or she lacks in the good things in life also
one of the reasons why people are dissatisfied with their savings or are
entirely deprived of them is because they do not have a savings system some
save by putting excess coins in a jar while others keep the rest of their
monthly salary after covering all expenses including purchases saving this
way is random and often leads to a slowly growing savings account even more
troublesome is that what is intended as savings accounts ends up as emergency
funds you might be wondering what to actually save for should this be for
large expenses such as travel vacations or maybe for retirement or future
investment all these complexities of saving lead people to random decisions
that affect the state of their finances so what can you do in this case the
solution is a savings system i'll elaborate as we go further in this video
having a savings system makes the entire process of saving money runs seamlessly
for instance if you are currently using direct deposit through your employer the
easiest and most effective way to set up an automatic savings program is to
transfer part of your paycheck directly to your savings account it doesn't
matter if it's ten dollars or five hundred dollars just setting up this
option will automatically ensure that you save money every time you receive a
payment and the rest will as usual flow into your checking account to cover your
monthly bills and needs that way you don't waste time or stress over what and
how you're saving mistake number four not regularly
reviewing you mistake number four not regularly reviewing your expenses
reviewing your expenses helps you better manage your spending habits increase
savings and make progress against your long-term financial goals it is an
integral part of proper money management as well as an element of personal
finances think about it if you were to budget once and never go through it how
would you know if you've strayed from your financial dreams also how do you
find areas for improvement in spending taking the time to look back and assess
your expenses will help you go beyond your daily life and improve future
financial decisions each time you sit down to review your expenses should
answer some very important questions however it shouldn't be just a short
mental conversation rather i encourage you to write down the answers to the
following questions each time you view your expenses this will keep you
accountable over time that's enabling you to monitor your progress also one
more thing it's time to be completely honest with yourself if not there's no
point in the exercise the first question to ask is what have i done right i like
to start my expense review with a positive note so take the time to look
back at the things you did well within your expenditures did you allocate the
right amount of money to each need have you managed to save a little more than
usual this month have you reduced your debt by a significant margin if you've
done something right no matter how small or insignificant it may seem write it
down the next question is what did i not do right even in the budgeting in my
best months i made mistakes or i failed in some way it's essential to address
these mistakes when reviewing your expenses or else you're deceiving
yourself a review like this shows you your strengths which you need to do more
of and your weaknesses which of course you should work on mistake number five
only making minimum credit card payments paying only the minimum amount owed on
your credit card bill can affect your credit scores and cause you to pay high
interest rates on the other hand paying more than the minimum helps you save
money pay off your credit card balance faster and can improve your credit score
however you may not understand how all this really works so let me explain the
minimum payment amount is the lowest amount your credit card company will
accept to cover your credit card balance each month you must pay at least this
amount in order for your payment to be considered on time and to avoid late
payments and other penalties some creditors may even increase your
interest if you make a late payment the lease payment amount is calculated as a
portion of your remaining balance or a fixed dollar amount it typically ranges
from one to three percent of the outstanding credit card balance and
includes accrued interest in applicable fees generally if your total balance is
less than the minimum due balance it must be paid in full it is essential to
raise your credit card issuers minimum payment rules as they vary from company
to company generally making minimum payments makes your card issuer consider
you as a high risk borrower and like all higher risk borrowers the company
increases the interest to cover up for the gamble that they are taking on you
mistake number six spending to keep up with the joneses this phrase used to be
about who had the bigger house the most modernized kitchen or whose child had
the best grades keeping up with the joneses usually referred to neighbors
next door across the street but as the internet grew it took on a new meeting
and social media greatly expanded the audience to keep up with it without
realizing it your colleague college friend or stranger you followed because
you like their way of dressing or because they seem to be leading the life
you want to live became the joneses then you spend time in obscurity and social
media documenting four vacations that you spent on last year which only got
you further into debt our culture has gone from wanting attention to showing
abundance to wanting to influence it's no longer about being able to drive a
new car but about the make and the model you drive the more people you
successfully plunge your delusional vortex the stronger your following
becomes and the more people will believe that you are the person one can envy
people are looking for confirmation of their social and economic status from
those around them thus social media becomes a distorted reality that has
created a false sense of self-worth this is a significant money mistake that's
very costly hence you'd be doing yourself a lot of good if you fought the
good fight not to get caught up in this trap mistake number seven not
opportunizing an employer 401k match if you're unfamiliar 401k is a powerful tax
advantage saving tool that you should be using to save for your retirement years
a 401k is a savings system whereby your employer tops up your account based on
your saved amount most employers offer a 50 match however some matches are as
high as a hundred percent today most private sector employers prefer defined
contribution plans such as a 401k in lieu of defined benefit plans where you
know exactly how much you'll be earning during your retirement years now for you
as an employee a 401k requires an employee to contribute and invest they
do not guarantee or define a particular payment in retirement ultimately this
can be very beneficial to the employee and the employer now you might be
wondering how the employer benefits and i'll show you how now employers receive
tax credits for contributing to 401k accounts in particular their matches can
be thought of as deductions from federal corporate income tax returns i.e they
pay less tax hence you should save as much as possible to take full advantage
of it because if you don't your employer will reap the benefits in full while you
get nothing in return hey it looks like youtube thinks this next video is the
one that will change your financial life forever give it a watch and let's see if
they're right