Have you ever wondered where all your money goes? Do you find yourself broke a few days after payday and can’t tell where some of the money went? You have some habits that are holding you down even with a reasonable income. Here is what’s affecting your finances even when you are receiving a good income.
Spending more and more
Even with a pay raise or moving to a better paying job, you may still find yourself in the same situation. A few days after payday, you’re broke and have to resort to borrowing. You’re a victim of increasing your spending just because you have more money.
There’s nothing wrong with improving your standard of living when you get a pay raise, but it ought to be done prudently. Instead you ought to change gradually, don’t move to a new house immediately, or take your children to a high cost school just because you want to match your peers. Instead continue with the same lifestyle and save the rest. Keep the expenses constant and explore ways to invest and increase your income, this is a sure route to a successful financial life.
Not thinking about the future
Some people argue that life is too short, enjoy while you have it. This may be the statement that leads you to struggle with your bills despite having a good salary. While there’s nothing wrong with giving yourself a treat, it’s important to remember your future. Plan for tomorrow, put some money aside for emergencies, or future expenses, for example; children’s school fees. When you plan for the future, things will be easier to handle.
Failing to plan
Most people argue that they know where their money comes from and how it is spent, but this is often far from the truth. We may keep track of major spending given its magnitude but small expenses are hard to track and surprisingly they take the largest chunk of our income. Budgeting and keeping a record of every expense and earning will help us control ourselves. We’ll be able to limit unnecessary spending as well as know how we can increase our income. With this we’ll keep track of and account for every coin. It’ll be easy to save as well invest our money.