7 Big money mistakes you might be making
These 7 big money mistakes could be making a huge difference to your savings balance, and not in a good way. Making these mistakes could be costing you thousands each year, so just think of how much you could save by fixing them. Read on to see if you are making any of the 7 mistakes.
1. Not asking for discounts
This one can save you huge amount of money every time you are in the market to make a big ticket purchase. Speaking from experience, more often than not you will be given a discount, you just need to ask. The worst that can happen is that the sales person says no!
2. No interest savings accounts
If you keep your money in a no interest bank account you are effectively going back when you consider annual inflation. Only keep what you absolutely need in your transaction account, and put the rest away in a high interest savings account. You need to make sure your money is always working as hard as possible for you.
3. Carrying a credit card balance
Not paying off you credit card balance in full each month could be costing you a small fortune in interest payments. The best thing you can do is pay of your credit card in full every month, and if you are not disciplined enough to only use your credit card for essential purchases, it’s time to cut it up! Read more about how to use your credit card to your advantage.
4. Buying on impulse
Buying on impulse is one of the quickest ways to drain your bank account. Always go home and give yourself time to think for 24 hours before making a big purchase; you might find yourself waking up the next morning realising you don’t really need that item after all. Avoiding treating shopping as a recreational activity is one of the best ways to avoid impulse purchases. Only head to the shops when you actually need something, and be sure you are armed with a shopping list (and stick to it!).
5. Not researching large purchases
This is something I do every time I am about to spend large amounts of money on a purchase. Set aside a little time to Google the product you are about to buy, see what others have to say about the particular item, and of course shop around and make sure you are getting the absolute best deal. Also, go back to money mistake number one; be brave and ask for a discount.
6. Buying brand new
There are times when it’s best to buy items brand new, but on the other had some items are best purchased second hand. Cars are the biggest culprit; why buy brand new when you could buy a model that is a few years old but still in excellent condition. Cars depreciate so much in value on the first few years of their lives, so let someone else pay that money. Buying a car that is a few years old could save you up to 50% off the new price.
7. Buying when you could borrow
If there is something you need or want, but it’s likely you will only use it once, why not try borrow it instead of buying? The same goes for library books; why spend over $20 buying a book brand new when you could borrow it from your local library for nothing? This is especially a good option when you know you will only read it once. You can also use your local library to borrow magazines, CDS and DVDs.