Hi... This post is not for the Super Rich... I would like to list some common money mistakes most individuals and families commit at some time or the other... 1.Lavish celebrations of family functions like weddings ,engagements ,birthdays etc. even if you cannot really afford. 2.Impulsive buying of costly things even if you dont really need them. 3.Taking a loan just because it is offered. 4.Buying things that depreciate in value(eg.electronic wares) as soon as they enter the market. 5.Taking a loan on high interest for anything that does not have a appreciable resale value. 6.Not maintaining regular accounts. 7.Not making savings a regular habit. 8.Standing as surety or guarantee for someone else's loan commitments. 9.Spending a lot on rentals when you can pay the same as an EMI for your housing loan + avail tax benefits. 10.Not taking medical insurance . 11.Frequently exchanging gold jewellery for the latest models and fashions. 12.Not making proper tax planning well in advance. 13.Living up to the Joneses. 14.Making an investment impulsively ,without proper enquiries about the documents/legal aspects. 15.Putting all your investments in one place.(put your eggs in various baskets) I shall post more later... You can share your inputs too...
The one thing I want to change this year is how we pay premiums, Our premiums are clogged from Oct - march. I think making all premiums monthly and auto - Makes it easier on purse and can curb unneccessary expenses. Will overcome the problem of having to shell out large sums at one time. You can plan for more investments too........
Armummy, Thanx for your first fb. Annual premiums are sometimes heavy on the pocket whereas monthly premiums are like RDs or SIPs.Easy on the budget. Good to know you are doing some rethinking abt it.
Thanks to the thread OP.. The most Moeny mistakes i do is: a. I spend /waste a lot of money in buying dresses/accessories which is not really necesssary. I observed that this habit has creeped in me only for the past one year.I should get out of this. b. I have been affected by CSD:biglaugh..Compulsive Shopping Disorsder.Whenever we visit Malls on weekends i end up buying something for my House or for my DS. :drowningOh GOD am sick of this...Let me come out of this
Shaka :cheers my kind of post. savings should be taught at school. I believe teaching fishing rather that giving a fish per day. i seriously don't understand this, but i know lot of people being taken for a ride on this guarantee's. in the 95 re boom, there were lot of people who had taken loan from indian bank in particular, with mutual guarantees to each other..it back fired a lot at that time, and also the interest rate on loans for property were very high too.. here, with the new changes in the budget, some people do not read the smaller print and go and invest in a second property. there is a corollary to the tax benefits for housing loan/property. tell me about it. i always tell people to do it. if you have a elder in the house, go for a floater cover. infact always ensure there is insurance for your Parent/Pil as the insurance companies do not give insurance after 65 in some cases and very few give at 70. this is again a real waste. the wastage, and the depreciation definitely eats into. i have a friend, who changes bangles/sets every two years. here, i would like to take my husband as an example. though he does not come under the tax slab now when he was working in india, the first thing after the budget announcements will be working his taxes and then planning the investments. i have been so irritated during the early days. but today i appreciate the planning.. this is something i have been noticing it. just for the heck of it, they compete with each other. if the daughter's classmate gives a party, they have to have one, and a little bit more grander than the one the other had... lot of people were taken for a ride by the schemes that said 10k per year and you have 5lakhs in 3 years/5 years. nobody takes the time to understand that no company can give that kind of returns..that it is always sensible to look at a minimum 8% returns and anything more is good...always take the promises of the mutuals funds/sales agents with a pinch of salt. I know a friend who has investments ranging in lakhs, but was running from post to pillar to pay the college fees of her son, because she could not liquidate the investment immediately. will add my points too.
Armummy, paying the premiums annually does have its benefits..it is slightly lesser than when you go monthly/quarterly. chart out your premiums and investments. the dates of premiums. so you will know where the clog is. just move the premium of one /two of the investments to halfyearly/quaterly. any new investment, always check your chart, to see what falls in which month..this helps in better planning. and also you can go into flexi accounts that allows you move some of our monthly salary into an fd style account, which will ensure you have the required amount at the end of the year or whenever you need to pay. also remember most agents pester you to invest in jan-march as they all strike the iron when it is hot, luring it for tax benefits.
