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4 SURPRISING MONEY TRAPS TO AVOID

Ah, money! We love to have it, but we are prone to make costly mistakes. When the current pandemic is threatening both the economy and our mental health, it’s fair to say that financial mishaps are more likely to happen. However, careful budgeting can only do so much for you. If you’re going to make sure that your pennies work hard for the household, you need to learn how to avoid money traps.

You may be thinking of financial scams or data exposure, but these are only some of the risks you are facing in your financial journey. Did you know that some of the most common money traps sit just underneath our noses day after day?

Spending for Comfort

It’s fair to say that during COVID most people are likely to find the situation stressful. What is your coping mechanism?

Emotional shoppers are quick to spend money, hoping to soothe their anxiety and feel better in the process. The more stressed out you are, the more you spend… which in turn means that your stress level is going through the roof. It’s a vicious circle! Learning to stop your shopping habits can be tricky, but in the long term, you need a healthy approach to stress management.

Making a Bodged Investment

Starting an investment portfolio can be a fantastic way of learning more about your financial potential, and perhaps build a steady second income. However, unless you are a certified financial advisor, you should seek professional advice. Accidental money frauds tend to occur when people are unaware that their investment decisions are illegal. Even though you may not have any intention of going against the law, you could find yourself facing fines and imprisonment! Ideally, you want to rely on experts with your investments; otherwise, you’ll need to put your fate in the hands of criminal lawyers who can lessen your punishment but not erase it! Surround yourself with reputable advisors.

The Ever-growing Credit Card Debt

As practical as credit cards seem to be, they can lead to invisible debts. Indeed, if you’re only in a position of making minimum payments every month, your credit card balance is unlikely to change. You may realise with horror that it could take several decades to repay your credit card debt with the minimum monthly payment. In this case, it can be helpful to reach out to debt settlement and debt management experts to consider the best options for you. Credit card debts can become an overwhelming budget drain if you can’t tackle them.

Unachievable Goals

We all want to be wealthy and have a bigger home. But very few people can make it happen! Failure to create an actionable strategy means that you can’t reach your goal. As a result, you are stuck in a situation where you can only dream of having more money without knowing how to make it happen. With a plan, your goal is pointless.

From losing money to not knowing how to maximise your finances, money traps are everywhere. Most of us, however, overlook common pitfalls that can affect their wealth. If you’re going to keep your money under control, you need to become aware of the risks around you. They’re easier to avoid when you know what you’re looking for!

4 Surprising Money Traps to Avoid