5 Common personal finance mistakes & how to correct them

• Not having a budget: Not aligning your income with expenses can be dangerous to your finances and lead to a debt trap.
Solution: Prepare a monthly budget and check your spending habits.‘Unfollow’ or ‘Delete’ any avoidable expenses!

• Impulsive spending: Getting lured by fancy ads and discount offers often causes the biggest dent in our budget.
Solution: Instant gratification is the enemy. Go for a walk before clicking on the ‘buy’ button. Next, review your budget. Think it is important enough to buy it now? Check for the best discount deal or look for alternatives that fit your budget.

• Not saving for emergencies: Not saving for medical and other emergencies can be financially devastating.
Solution: Get a medical insurance to take care of any unexpected expenses on that front. For other things, set aside at least three to six months' worth of living expenses only to be used in case of emergencies. Make this a top priority.

• Carrying credit card debt: Living life king size by paying only the minimum amount due on credit cards makes you look great on social media, but sadly, it makes you look‘not-so-great’ on your credit report and throws your finances for a toss. Guess which one is more important?
Solution: Pay off the high-interest debt at the earliest. If you have more than one credit card, you can surrender the ones with the highest interest rates and transfer the balance to a low-interest credit card. Spend only as much as you can afford to pay.

• Not investing for the future: If you don’t invest for the future, you’re missing out on potentially building your dream life with sufficient income and wealth to fulfill your most ardent wishes.
Solution: Make money work for you by considering goal-based investing. For example, invest in an equity mutual fund for long-term goals like retirement.

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