Man Under Debt

Common Mistakes to Fetch Yourself Under Debt

At present, the inflation is very high. A little bit of a mistake can bring a financial crisis. A small mistake in using money can cause a lot of financial problems. People are beginning to live a higher life Standards to show their dominance over time because they observe others life style, not their financial situations. Which eventually makes a mountain of debt and drowns itself in debt.
The following are some reasons which may be responsible for persons debt condition.
Followings points may be useful in your life to avoid financial losses in your life and save from burden of unwanted debts.

1. Family planning without studying financial situation:

Every decision of life depends upon our financial condition. If someone makes expenses out of its position definitely leads to himself under mountain of debt. Every person has to first look at his own financial condition and current source of income. For example : if current source of income is not sufficient for two persons then one has to first increase income by alternative source or by changing job. After getting sufficient income for two persons, he or she may think about marriage to avoid burden of debt.

 2. Use of Credit Cards for Everyday Expenses

When you use your credit cards in everyday purchases to cover the shortfalls in your spending, you are running a huge amount of debt for a short period of time. Observations says that People tend to spend more money when they are paying with credit. It is also stop to give close attention to your budget when you constantly uses your credit card. You need to stop using your credit cards and start following a budget and kick your credit card habit.

 3. Quit Job Without Plan

It is more difficult to find job after leaving job without any alter arrangement. If you feel that current job is not satisfying or situation is not good, you should start searching new job. Quit job only after getting new job opportunity. It will prevent you from any gaps in your employment experience. You can even decide to accept pay cut in new job, but you should be secure in knowing that you have a job and income is there.

its also to be noted that if you are resigning from job you are not eligible for unemployment insurance. You may fall in very tight financial situation.

 4. Remain Engaged to a Dead End Job

If you are well familiar that that job at which you are working is no longer will remain safe, it is nearer to the end, you should change the job. If not planned in advance can hurt you financially.

You need to determine the right time to change the job and to find a new job. Also you should learn  the new skills that you will need to find a job better suited to your interests. Start preparation in time so you can qualify for your new job.

 5. Borrow Money from Relatives

When you are in tough financial situation, you may like to borrow money from your relatives or your family. When borrow from relatives, you put strain on your relationship with them. Relatives may begin questions regarding your financial decisions. They may also need the money back suddenly in case of emergency or you may feel guilty whenever you see them. You should also keep in mind to never loan money to family or friends to save your relationship.

6.  Failing to Maintain Budget

If you are not spending money as per your budget and fail to maintain it for long time means you do not have control over your financial situation. You should have to prepare your budget as per your income to avoid tight financial situation. It can be difficult to complete your financial goals when you do not prepare a solid budget. To avoid such conditions you need to take time to set up budget and to follow it every month. You can start to make better financial decisions if you have solid budget and you know exactly where your money is going every month.

7. Making Financial Decisions in Fear or Pressure

In the condition when you are afraid or feel pressure to act, you may not consider all of the option and decide a totally wrong thing. It happens due the reason that when you are afraid or in pressure you does not have control on sense to check all sides of your financial decision. It is always desirable to have a back step and consider all of the options available. Also you should talk about your decision to the person upon whom you can trust before going for finalizing any of your deal.   Another financial mistake to give into pressure is to take a big financial step like buying a new car, purchasing a home, getting married or having a child. Every major steps should be taken only after making self financial strong enough to avoid financial pressure and strain. You should not take such steps until you fill comfort to take it. It is really appreciable to make each financial decision based on your own timing, goals and needs.