5 mistakes people make with their money

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Every year a lot of Ghanaians lose money because of wrong typical financial advice and bad decision-making. Without the right knowledge and products, your finances will only get worse by the day.

Ready to take control of your money? It won’t happen overnight, but you can make it happen. Success is your duty. Jerry J. Afolabi, the financial advisor, advises that you need to secure your financial future and grow wealth, as most people have no clue where to start.

But you will also need to avoid these five common mistakes people make with their money so you can protect, secure and grow wealth for financial freedom.

Here are the 5 common mistakes I advise people to overcome every single day.

Mistake #1

Not saving enough

To be financially free, it is important to save enough and not just save.

A client asked, “what is enough?” As a general rule of thumb, you should be saving at least 10% of everything you make in income/salary or profit.

20% of all income should be used to build an emergency/endowment fund for you and the family.

70% is for living expenses (food, shelter, insurance, car payment, groceries and transportation etc.)

This is the 10-20-70 rule, and it works like a charm.

Mistake #2

Keeping money in the wrong place

Financial institutions licenced by the Bank of Ghana are qualified places for people to keep their money.

However, because of the recent banking crisis, it is critical to seek advice from a professional or expert before you deal with any financial institution.

You need to be very sure of where you keeping your money, because your financial progress depends on the financial institution you deal with.

Charges, fees, penalties, balance sheet and the board of directors, market volatility are things you need to also consider before keeping your money with a particular financial institution, since they are critical in the growth process.

You can again sign onto a good insurance plan that takes care of your financial goals. Always keep your money with financial institutions; that makes it easy for you to access your money, and with no or little charges/penalties.

Mistake #3

Getting the wrong product

Getting the wrong product that does not fit/meet your needs can cost you lots of money and time.

3 quick questions to ask that will help you avoid a bad product:

  • Are there any charges/fees/penalties which are not disclosed?
  • Do I have unrestricted access to my money?
  • Will this product meet my goals, and is it sustainable?

If there are charges/fees and penalties, make sure you fully understand what they are and when they can be charged.

Important: Do not move forward if you are not fully convinced. Only purchase a product when you are comfortable and certain of what you getting.

Mistake #4

Not taking action

Taking action and making the right decisions is a must in order to secure your financial future and freedom.

Bottom line: When you know what you need and the product fits your goals, take action.

Mistake #5

Investing

All the very successful and financially-free people have taken action to secure their money; there are 4 financial disciplines that you must get right:

  • Protect
  • Save
  • Manage
  • Invest

It is always best to get protection for your money, save enough, manage your savings and then start to invest the money to grow it. Find a good investment product and diversify your portfolio.

©Jerry J. AFOLABI is a Financial & Economic expert who believes that ordinary people can do extraordinary things when given opportunity. He is a leader in his field and his community. His passion is to empower young people, adults, entities today with a love of learning and self-determination to become effective and self-reliant citizens Email; [email protected], Tel; +233541238987. #MONEYTALKGH SHOW#

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