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Top Five Financial Mistakes

Here we identify a few financial mistakes; which you need to correct immediately and start afresh!

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Holi – the festival of colors is symbolic of a season of change; change to embrace the new and let go off the old. Think of the last year you looked at the Holika, and prayed as you saw your past year burning and embracing the New Year with full gusto. When it comes to managing our money, we often wallow in the mistakes which we have made, rather than learning and moving on from them.

Financial mistakes are a part and parcel of your financial journey. Nobody is 100% accurate and along the way, we all make some regrettable decisions. The important part is to identify the mistakes, so that it is never too late to act upon them.

Here we identify a few financial mistakes; which you need to correct immediately and start afresh!

Don’t give up on savings
It is common to see individuals give up on the easy solutions like saving money, because they believe the impact is limited. This is not true. If you set aside even a small sum of money from your salary / income towards an emergency fund, you will find yourself mentally at ease when it comes to tackling financial contingencies. So, try to save as much money as possible – this will mushroom into a tidy sum over time and before you know it you could be on the rebound, financially.

Hence, refrain from keeping up with others, as it will help you concentrate better on your finances.

I don’t need a financial check – I am fine!
Most of the times we get comfortable with our current financial conditions to a point, where we believe that we do not need an overhaul of any sort. Resultant, we end up paying our dues and premiums more than we ought to and fail to identify the areas, we might get a cut-back.

Hence, make sure you get in touch with your financial advisor on a regular basis – to give your portfolio the financial overhaul that it needs.

Don't take on needless stress
In a bid to put their finances in order, we often stress over variables that are clearly beyond their control. For instance, you can control your expenditure like taking public transport more often rather than the car, eating in rather than eating out. What you can’t control is whether your position will be downsized or whether the government policy will hurt your business.

Common sense tells the individual to stop stressing over his job or government policy since they are not in his control and will only lead to frustration. It is more purposeful for him to focus on the factors within his control like trimming wasteful expenditure.

Don’t participate in emotional spending
Admit it! We all have indulged in emotional spending at some point or other. While at that time, it might seem like the most pertinent thing to do, you will certainly end up regretting it later on. If you have identified your trigger points for emotional spending, then act now!

As I sign off, wishing you a very Happy Holi – hoping that the festival of colors brightens your life. Make sure you are judicious with the use of water and keep away from harmful chemical. Have fun and stay safe!

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.

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personal finance

Rahul Jain

The author is Head, Personal Wealth Advisory, Edelweiss

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