To make a rather crude metaphor, money is the blood of our personal finances. There’s a minimum amount that we can survive on and people seem to freak out when there’s a lot of it in one place.
But what a lot of us don’t realise is that it’s so easy to start haemorrhaging money that by the time we notice, we may have lost a small fortune. And unlike blood, you can’t really get a money transfusion when you’re running low.
Unless you have a bunch of stuff you can sell or something.
Here are some reasons you might be loosing your sweet moola.
Living larger than you need to
You know the drill, you’re already living pay-to-pay and when you start earning more money nothing changes. People generally interpret more money as a license to buy more stuff, and it’s likely you don’t even need it.
The next time your income gets a boost, try saving most of it or cracking the investment whip to get it working for you.
It’s also worth assessing your spending to identify areas where you can make cuts. Stop eating out so often or buying so many candles.
Copping credit card interest
Interest is not your friend, so why let it hang out with your money?
Clear out any high interest debts as quickly as you can because the lower the balance, the less you’ll pay to those greedy banks.
Going back to the weird blood analogy, pretend that the banks are vampires trying to get their hands on your money-blood and your credit cards are the fangs by which they bite.
Drive a wooden stake straight through the heart of that blood sucking parasite and be free!
Getting caught up in the extras
“It’s two for $7 if you want to grab another one”
“Do you want guacamole for $1 extra?”
Sound familiar? That’s because it happens everyday, everywhere you go. Why? Because it works! Either in the heat of the moment or because your a total fiend for guac, they’ll get ya.
Show some self control and reign in your extra-happy splurging, especially when it starts getting to the big ticket items that are offered on cars or expensive electronics.
Letting your money stagnate
Why keep your savings in an everyday account when it could be earning you money?
Get the most out of your cash by putting it into a separate high interest account. That way, it’s harder to access at short notice (at the pub after too many schooners) and it will be slaving away for you for a change.
Think carefully about where you keep your money and how you use it, because chances are you’re leaking it somewhere.
Here, we’ll even play you some thinking music while you mull it all over.