Do you find yourself bringing home a fat pay check every month but end up scrambling to make ends meet by the time the month is over? This is probably why!
Have you ever wondered where all your money goes? You have a cushy job and earn a princely sum every month, but you’re left wondering why NASA keeps sniffing around the black hole that is your bank account at the end of every month. For the life of you, you just can’t figure it out, because you’re dead sure that you don’t spend extravagantly at all.
Or so you think! Most people who earn a lot but end up with nothing to show for it as the weeks go by, in fact, live in a little bubble of their own where they assume they manage their finances like consummate professionals.
Unfortunately for them, they go from month to month practically yearning for their next pay check like a fish on land gasps for water, wondering how on earth they’re left with nothing but small change to get by.
Additional Reading: 10 Dead-Easy Saving Habits For You
If you happen to find yourself in a situation like that and can’t figure out why, here are a bunch of reasons why the only thing your wallet is full of is moths of various shapes and sizes.
One of the biggest reasons why you end up scrambling for funds at the end of every month is simply poor budgeting. You either allocate way too little towards savings or even if you keep something aside for your savings, you end up dipping into it midway through the month because you’ve blown the rest of your salary on all sorts of things you probably don’t even need.
Make sure you draw up a budget and stick to it no matter what. All it requires is a little bit of discipline and an iron will. Try and reduce expenses that otherwise can be avoided and make sure your savings are set aside in a Recurring Deposit or something similar. This will not only help you save money, but will grow your wealth over time.
Additional Reading: 6 Common Budgeting Blunders And How To Fix Them
This is a no-brainer, of course. Regardless of how much you earn, if you spend like there’s no tomorrow, then you’re certainly going to end each month just short of sitting on the sidewalk with a begging bowl in one hand.
If you have a habit of dining out every weekend, and especially if you have a habit of going to expensive places, then you’re certainly going to whittle away your salary in no time at all.
The only way to tackle this is to put your foot down and not give in to temptation. Although you may feel like you’re ‘missing out’ if you don’t go out partying with your friends or colleagues every weekend, you’ll certainly feel a lot better once you see your bank balance in the pink of health at the end of every month.
Additional Reading: 5 Daily Habits That Make For Frivolous Spending
Credit Card Debt
Do you swipe your Credit Card without a second thought? Then, that could certainly be part of the problem. If you end up using your Credit Card for just about everything that catches your fancy, then you’re going to be saddled with massive Credit Card debt in no time at all.
The higher your outstanding Credit Card dues, the higher your monthly minimum repayment becomes. And of course, there really is no point in paying just the minimum balance every month since it doesn’t really reduce your outstanding balance by that much.
So, it’s probably time to put that fat salary to use and pay off your debts once and for all. And while you’re at it, lock away your Credit Card and make sure you use it only for emergencies or when you’re absolutely sure you can pay off the outstanding dues quickly.
Additional Reading: 5 Good Credit Card Habits To Acquire In The New Year
There you have it. There are probably many more reasons why you’re still struggling financially even though you earn a lot, but these are certainly three of the biggest ‘culprits’ that eat away your money.
In any case, maybe it’s time you opened up a Fixed Deposit so that your money can grow over time and give you something to fall back on when times get rough. We have some great options for you to check out.