The Truth About Money
Money Mistake 1:
Never borrow money that accrues interest to start a business (except if you are paying for it through your salary); only borrow to grow your business.
This is because business takes a long time to gain ground and begin making profit, yet most loans repayments have to be made within a month of taking the loan or even earlier.
Most specially those that use to take all these online loan from mobile loan apps: Branch, Go Credit, Go Cash, Quiche Check, Alla Credit, LCredit, ECredit, Palm Credit etc. Lapo.
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Therefore, never borrow money to start a business expecting that the business will generate income to pay back the borrowed money plus the interest.
Most of our market women have slept in the toilet all in the name of defaulting. If you notice these days there are some text messages dropping on your phone that a friend of yours has absconded after taking some amount of money from a loan app and he has been declare wanted as fraudster.
Money Mistake 2:
Never spend money you haven’t received. Don’t even promise someone money based on a promise you have from someone else.
If someone tells you: “Kunle, come to my office tomorrow at 10am and pick N3,000” don’t go out to buy items on credit based on this promise, with the hope that you will pay off your creditor when the promised money comes; it may not come as promised and this will leave you in problems with your creditors.
Money Mistakes 3:
If you want to save, whenever you receive money, don’t start spending hoping that you’ll save what remains.
Normally what remains is zero because as long as money to spend is available, the numerous things you can spend it on are also available. And things to spend on even incite their ‘relatives’ so that you spend even more than you had planned.
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When money to spend is not available, we naturally find a way of doing without it. That’s why I’ve learnt to save in an INVESTMENT ACCOUNT.
Once I send money there I assume I no longer have it. Before you spend any money, put your savings aside then spend what is left after saving.
Money Mistake 4:
When you get an opportunity to meet a very wealthy person, never ask for money. Ask for ideas on how to make money.
They may even choose to give you money on their own after seeing that your ideas are great, but let getting money from them never be your objective.
Money Mistake 5:
Keeping your seed instead of planting it. Many people stop at saving. It’s very, very difficult to save and have all you need to maintain your lifestyle especially after retirement.
When you save, your savings are seed; plant it.
When you just keep the seed (saving money) some seeds begin to die (eaten by inflation and the like). That’s why I recommend that you read about the different types of investment vehicles you can use to grow your savings. I am not necessarily talking about putting the money in a business, because you can easily lose money in business but it’s better to invest it in a fixed account. I am talking about putting it in an investment.
Money Mistake 6:
Never lend someone money you are not willing to lose. By the time you lend someone money, be contented in your heart that should the person fail to pay, you will not die.
You should not even lose that person’s friendship if they fail to repay the money you lent them. If you feel the person might fail to pay you and this will not affect your relationship with them, then lend them money.
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If their failure to pay would make you hate this person’s entire clan, please advise the person to go to the bank.
This also applicable to those that sell credits to debtors. Frankly speaking, selling credit to your customers is one of the biggest mistakes business men/women make that can ruin their business.
For instance, when you sell credit to one of your regular customers and he or she is unable to pay back on time you may not see him again until he has the money to pay you.
This is a way of sending your customers to somewhere else because they won’t patronize you and the will buy from another seller.
Money Mistake 7:
Never append your signature to guarantee someone on a financial matter if you are not willing or able to pay the money on their behalf. Do I have to explain that one? No, it’s self-explanatory.
So many people have paid back the money what they never borrowed all in the name of been a guarantor.
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I am not telling you not to stand for your love ones as guarantor but mine who you stand for and make sure the loan they want to acquire is affordable for you without any effect on you financial status in case the person abscond.
Money Mistake 8:
Avoid keeping money you don’t intend to use in the short-term within easy reach. For instance, don’t walk with N10,000 in your pocket when all you plan to do in a day costs N2,000.
Like I mentioned in Money Mistake 3, there are always expenses available to gobble any money that is within reach, so if you don’t want to lose it, put it away in a safe place.
Money Mistake 9:
Avoid keeping money in inappropriate places e.g. in socks, under the pillow, in a pit, in the sitting room, in the bra, in a travel bag that you will place somewhere in a bus … impulse buying is a devil that will keep you busy!
Apart from from the spirit of money that will be pushing you to spend unnecessarily, keeping money in the bra has another side effect in your system. It can cause cancer of the breast or chest due to the chemical in the paper money.
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Money Mistake 10:
Spending money on an item that you can do without (at least for the time being). These days when I pick money from my pocket or wallet, before paying for something I ask myself: What would happen if I didn’t buy this?
If I find out I can live with the consequences of not having that thing, I smile and walk away.
Most guys and even ladies spend money on what they know they can do without and that is why most people go out with money today and go broke tomorrow.
Money Mistake 11:
Paying an amount for something that’s not the minimum you can get that same value for. In other words, if you are at Spar and you pay N15,000 for a shoe that you can get at N3,000 at Rumuokoro, that’s a money mistake except for those who have achieved financial freedom.
Dough, there is no amount you spend on yourself to look good that is too much but when you can get a commodity at a lower cost and you move on to where you buy the same quality and quantity of that commodity in an expensive place, it a very big mistake we should avoid.
Money Mistake 12:
Wanting to be the savior of the world by helping everyone in financial need. My sister, my brother, you are not Jesus.
If you find it so hard to say no to a financial demand, you may think you are practising generosity when in actual sense you are committing (financial) suicide.
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We are not learning to be miserable here; we are learning to live within the boundaries of reality. Quote me wrong anywhere you can’t make it.
Money Mistake 13:
Consistently spending all you earn or more than you earn.
It’s like having a drum where you have an inlet that’s smaller than the outlet. It will never get full. And should the inlet ever reduce significantly the drum will run dry.
If you do it the other way round and the inlet is bigger, it will get full and even overflow. Hence, we have to always ensure we are widening the inlet while narrowing the outlet – all the time. Your side hustle comes in handy!
Money Mistake 14:
Thinking about short-term only and forgetting about long-term or thinking about the long-term and forgetting about the short-term.
For instance, Ronke was told that there’s money in land. She saved money over a long period of time and bought 30 acres of land.
Now she has the land but she is always broke. She is always complaining. She’s disgruntled and she doesn’t seem to see herself earning from the land in the near future.
Now, let’s ask ourselves: Having 30 acres of land and no money to feed your family or take a child to hospital, is that wealth or poverty?
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I think Ronke only looked at long-term needs and forgot that she has short-term needs that require money. What of those who find they are one paycheck away from salary?
Are they thinking about the long-term needs? Let’s take stock of our finances.
How many mistakes are you guilty of?
Do you now feel better-equipped to do better with these 14 tips?
Adjust and correct your mistakes then enjoy your financial journey…