Many people spend more than they earn and many do not even have enough savings to cover expenses if they were temporarily without income. Here we give tips for mistakes you can avoid to have more money every month.
You can't manage what you can't measure. If you have no idea where your money is going, how can you move money to make your own life easier? You can start with a basic budget or figure out what to work with. Then just stick to it. Try that for a month and you will see where money leaks are and of course you will know how to fix or reduce them.
€9.99 per month for unlimited music? Yes please. €10.99 per month for unlimited streaming? Yes please. Before you know it, you'll be months into a subscription you've never used. Or you've signed up for a countless number of subscription services that take you 30 hours a day to even use them properly.
This is such a small but snowball effect into your monthly spending so you never notice it coming out of your account. It's also such a small amount that you can't be bothered to cancel it. Re-evaluate what subscriptions you have and whether you haven't used it in the last renewal period. Think about it. You can always subscribe again in the future, right?
So many millennials and adults are living way beyond their means. More often than not, when someone gets a raise, they think, “Oh wow, I have so much money. Time to elevate my lifestyle. I want to buy this and that now. But that's so unrealistic with the small increase. You have to be real with where you are and make sure you don't spend more than you earn. Calculate your monthly income and anything extra you earn – save it for a rainy day.
We've all heard it before, but not everyone really has an emergency fund. That's an amount set aside that you won't touch unless something crazy happens in your life. You are evicted or you suddenly lose your job. By putting money aside for emergencies, you immediately know there is cushioning and this will take some of the financial stress out of your daily life.
Many people spend their free time on "leisure" activities, including recreational, leisure and social activities. That means if you take a fraction of that and spend it on something that can make you money, you'd go a long way.
Think about that. That's 5 hours a day spent binge-watching TV, or reading novels for sheer pleasure, or maybe it's just for lack of something better to do. You could maximize your day by taking up a second job or income stream.
Now there's nothing wrong with dreaming big. But it's so important to have a plan to get there. If you want to buy a house or start a business, you need to put it on a timeline and assess how you can get the resources to achieve the goal.
Instead of saying "I want to be a millionaire". Reformulate things with a timeline and a method or path behind it. “I want to invest in real estate to build a portfolio of one million euros over the next 7 years”
For some people, having a credit card is great because they know how to use its benefits and avoid its drawbacks. But it's important to be very, very aware of all types of debt. This is money you owe, and it's something that will follow you.
So make sure you don't spend too much money on credit cards and only collect what you know you can pay back. After all, it's not free money.
We all have some sort of subscription service or monthly fee, so it's important to shop around and make sure you get the best value for your situation.
Whether it's insurance, phone plans, electricity, or maybe even rent, make sure you check your expenses every 3-6 months to make sure you're still getting the most competitive rate. Don't just assume it. Double check and do your own research.
