1. Using a Credit Card as a Loan
Credit cards are great and serve a purpose. In most countries, you need it to build a good credit score. But the problem with credit cards is that we think it’s a free loan.
“I can spend my money now and pay later,” usually doesn't always end well. If you’re in debt, assess your financial health, negotiate lower interest rates with your credit card provider, make extra payments to your loans when more money is coming in and cancel unnecessary memberships.
2. Borrowing Money for Liabilities
There was a gentleman who leased a German sports car for three years. It cost him about $3,500 a month including gas and insurance. That’s $126,000 in three years before any investment gains.
He was quite apathetic about it. “I really enjoyed driving that car, but I can’t help to think that I probably could’ve bought a condo with that money.”
Don’t be that guy.
3. Having One Income Stream
People who have one income stream usually live with a perpetually fearful state of mind and terrible money habits. They realize that their income is vulnerable. They’re afraid to lose their job, so they say yes to everything and let people walk over them at work. That’s how many people become bitter over time.
But you don’t have to do that. By investing in yourself and spending less time on entertainment and consumerism, you can build a more stable career.
You can build a side business, invest your money in real estate or dividend stocks, or work in a field with a lot of job prospects. When you have options, you feel more at ease.