Have you ever seen a financially wise person? If yes, then you might know that they approach every money problem with a logical mindset. Their wisdom prevents them from becoming emotional or impulsive buyers. They seem to always know what is in their best interest.
However, the thing is that, as humans, we cannot quite remove our emotions from the decision-making process. But – there are certain mistakes that people make with their money, and being able to predict those mistakes can help you avoid them.
Of course, you can spend your money however you like – but – there are certain silly mistakes that you will want to avoid at all costs.
Here are the mistakes:
Mindless Buying
The first mistake you will want to avoid is going to the store without knowing what you will buy. Just imagine how absurd it looks – going to the store without even knowing what they are going to buy.
For instance, instead of saying they need to buy milk and go to the store, they might simply say they are going shopping. And you will find many stores around you that exist for these purposes. They attract people who are there without needing anything and leave the stores with the cart full of things that they don’t need anyway.
Now think about it from a rational perspective. What a silly thing is this to do with your money? The thing is that if you don’t know what you are going to buy but are still heading to the mall or store – then you don’t need it at all.
Ordering Cold Food
Another mistake many people make with their money is ordering cold food using one of the delivery apps. Anyone who has used the apps knows that the average delivery time of food is between 30 to 40 minutes.
Here is how it goes – you use an app to order the food, the restaurant prepares your food, and the driver picks it up. After approximately 40 minutes, you have a bag of cold food delivered to your door. Ordering food is becoming more and more of a thing – we all know someone who orders food every day – because they know nothing better.
Just think about it – it is a foolish thing to do. You will be spending nearly double the price for a cold meal to get delivered to your doorstep. Sometimes we don’t have another choice – especially on our busy days.
But – when it comes to making financially smart decisions, you will want to stick to a budget, create an emergency fund or set up a savings account where you will want to save at least 30% of your monthly income. Click here to explore more about the benefits of high-yield savings accounts.
Avoid buying food on an empty stomach but make a monthly budget and include a weekly meal planner. This way, you will know what meals you will be preparing for the week at home. You can use your weekends to prepare fresh, healthy, and yummy meals at home – put them in the freezer and then heat them up whenever needed.
You will be surprised to know how much money you could be saving in the long run. Also, you will eat healthy meals instead of junk food, leading to obesity.
Feeling Good about New Purchases
If someone ever congratulates you after you just made a new purchase, you were ripped off big time. Suppose you go to a store to buy a broom – you pay for the broom and leave the store with the broom. And that is the end of the story.
But if you go somewhere expensive – for instance – at an expensive car dealership and you pay to buy something really expensive. The store employees will probably congratulate you on your purchase. Now, this act of congratulation means that there are no other words to say that you just got ripped off.
You will want to be mindful of these nice words as these are nothing else but a marketing strategy designed to make you feel proud about your financial mistake. Think about it – what are they congratulating you for? You didn’t win the item – you spent your money to buy the item from the seller.
Emotional Buying
Many people don’t spend money on the item or food, but they spend money on the words that lie behind them. Now a restaurant might not be selling organic and fresh meals – but – if you were to look at their menu or around the restaurant, you are more likely to see words, such as natural and organic, used everywhere.
From the customer’s perspective, you might have gotten the idea that someone’s grandma is in the back chopping up spinach to put in the soup. So, you will believe the words over the reality that the restaurant is selling you frozen items, which is the normal case for most restaurants anyway.
Words are powerful – and marketers know how to use words to get an emotional reaction from their potential customers. However, these words are just a trap to lure you into the buying funnel and to make you think that you want to spend your money on the empty promise that the words are conveying.
When certain words are used – people are ready to spend a crazy amount of money.
Purchasing a Big House
Of course, buying a house is nearly on everyone’s bucket list of goals. However – before you invest in something as big and solid as a house, you will want to sit down and realistically assess whether you need a house and all that space that comes with it – or – whether you are good with renting an apartment for now.
Think about it – what good is a big house when you will only be using 20% of the space? If you are alone, using three bedrooms, four bathrooms, and a theater is impossible. If you are purchasing a big house and don’t have a big family, you are just spending money on wasted space, which isn’t a wise move.