‘Live life king size’. That was Rahul’s motto in life. From an expensive car to the latest mobile phone to a big plasma TV set, Rahul had it all. Renting out an apartment in a posh area, Rahul made sure that he and his friends partied every other night. Binge drinking, frequent eat outs, shopping for high-end brand clothes and watching movies at expensive multiplexes were all a regular part of his lavish lifestyle. Isn’t Rahul living the urban dream which every guy in his 20s craves for? Do you wish to live like Rahul? Be careful what you wish for, as underneath that swanky, extravagant lifestyle is the road to financial doom.
Most of us like to live in the present. While we are all game for it, planning for your future is something that cannot be ignored. The truth is that deep down, everyone is worried about what the future holds for them. Now, we can’t predict how your personal and professional life is going to pan out but we can certainly tell you a thing or two about your future financial stability (or instability) by looking at your current expenditure. Here are 10 bad money habits that could seriously affect your future.
Expenditure greater than income
Expenses should be planned keeping your monthly income in mind. By not doing so, you will end up spending more than you earn and burning a huge hole in your pocket. This is not good news for your future finances.
Savings! What’s that?
The golden rule of building a bright future is to save money in the present. While most try to save money, many fail miserably when it comes to generating decent savings, thanks to their lavish lifestyles. This habit of not saving could land you in soup. A day will come when you need money for something like the downpayment on a house or the marriage of a child. You’ll probably be wishing you had saved more.
Late payment of bills
Paying bills on time seems to be an unknown concept for a lot of youngsters. Don’t think that there won’t be repercussions in the future. By piling on bills and paying them past the due date, you are not only bound to shell out extra money as a fine or interest, but it will also adversely affect your Credit Score.
Check This: Impact of Late Payment on your CIBIL Score
Without understanding the actual market risks, many people blindly put money in alluring investment schemes with dreams of reaping rich dividends. If you put your money on risky ventures, it is a huge gamble that could even leave you bankrupt. No future there.
Piling loans and debts
Taking loans from banks has become so easy nowadays, that opting to use loans for pretty much anything and everything seems to have become the norm. Before you take a loan to sponsor that foreign trip or buy that expensive car, ask yourself if your expenditure is really necessary. Piling up debts to fulfil your wants and whimsical wishes will leave you with nothing for the future. What you could do instead is have certain financial goals and start saving to meet them.
Procrastinating on important financial decisions
We have developed this habit of procrastinating on things and leaving everything till the last minute. Important financial decisions like buying that plot of land, or opening a Fixed Deposit, or investing in Mutual Funds should never be left for tomorrow.
Binge drinking, excessive partying, and frequently eating out are a few habits associated with indulgent living that can damage not just your future finances but also jeopardise your current financial stability. Now we aren’t saying that you should never indulge yourself. We just mean, keep things under control.
Check This: What Can Rs. 1,000 Get You?
Too scared to invest
While most of us suffer from investing in risky ventures, there a few who are way too scared to make investments thanks to the market risks. It is important to understand that risks are a part and parcel of investment and there is no harm in investing your money in relatively safe ventures such as Fixed Deposits and Debt Mutual Funds.
Check This: Best Investments For The Next 10 Years
Failing to avail of tax benefits
These days, youth don’t seem to care about tax benefits and end up paying a lot of taxes from their hard-earned money. By simple declarations and investing in tax saving schemes, you could save a lot of tax money. This will all add up in the long run.
Check This: Investment Tips to Save Income Tax
Insurance? No thanks!
Last but not the least important, most of us don’t believe in insurance policies and thus are often unprepared for future emergencies. By not opting for an insurance cover, you are leaving yourself, your family, and your property financially insecure. What kind of future would you have then, if something were to happen and you weren’t able to manage the finances?
So, leave behind these bad financial habits today! Start planning your finances right away!