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With the arrival of a new year, it is common to set goals and objectives. However, in order to achieve your goals, it is necessary to make good planning. Also, there are some financial mistakes that should be avoided.
After all, they can hurt the budget and trigger debt problems. In this sense, they should be known by those who want to have a more peaceful and financially balanced end of the year.
With that in mind, I prepared this article to present the 5 common financial mistakes at the end of the year. Still, I’ve separated tips to help you avoid these problems.
Continue reading and find out more!
The lack of financial planning is one of the biggest villains of finance, especially at the end of the year. At this time, it is common for several bills and tax payments to arise, requiring you to be prepared for the extra charges.
Therefore, organizing and planning finances is a way to succeed and start the next year well. This habit should also be maintained over the months, as money control helps to identify waste and savings opportunities.
Then, whatever is left of the budget can be invested to achieve your short, medium, and long-term goals. Thus, organization and planning make the process easier. It is worth noting that the strategy also helps to avoid indebtedness and to have more security against unforeseen events.
After understanding the importance of planning to maintain financial health at the end of the year, it is worth knowing the top 5 mistakes people make at this time and knowing how to avoid them.
Check out!
Many workers anxiously await the arrival of the December salary to spend superfluous. However, it is important to keep a reserve, which can be used to write off debts or reduce interest, for example.
Another possibility is to save the amount and use it to increase investments, which helps to achieve your goals faster. Therefore, spending the entire December salary without planning is one of the main mistakes at the end of the year.
At this time, companies tend to invest more in advertising and advertising, generating triggers for purchases. Thus, those who do not research prices in advance or do not plan carefully can spend more than their budget allows.
To avoid compulsive spending and not be vulnerable to excessive purchases, the tip is to think about your own goals and what, in fact, you need to acquire. Having a wish list, for example, is a good way to stay true to your needs — but don’t go overboard, okay?
When shopping for Christmas and New Year, avoid using your credit card and paying in installments. When adding up all the expenses made in that period, the invoice may be higher than the financial planning allows.
Spending more than you could and making credit card commitments increases the risk of falling into overdraft. This attitude also tends to reduce its consumption power in the not-so-distant future.
In this way, in addition to preventing future debts, paying for purchases with cash allows you to try to get discounts. This is because many stores prefer to receive cash and offer better conditions to customers who pay in cash.
The beginning of a new year usually represents the arrival of some accounts, such as IPVA (Imposto sobre Operações de Veículos Automotoro) and IPTU (Imposto Predial e Territorial Urbano). These expenses are recurring and often have close maturities.
Therefore, it is essential to plan for these expenses. Those who have children also need to consider costs related to enrollment, school supplies, and uniforms, among others. This means that if you spend too much, you won’t be able to afford the next year’s responsibilities.
Preparing in advance for the expenses of that time can also guarantee a good economy and avoid serious financial problems for the next few months. In some cases, paying in cash can mean a good reduction in value.
If you plan to travel later in the year, keep in mind that packages in high season are more expensive than at other times. This is a result of the great demand for tourism services at this time of year.
To avoid excessive spending in the period, avoid long or unplanned trips. Opting for the low season is also a tip that can help you save money. If this is not possible, always try to plan the tour well in advance.
Thus, there are chances of getting discounts or more affordable prices. Keep in mind that the closer to the desired date, the more expensive services tend to get.
As you have seen, awareness, planning, and focus are keywords when it comes to preventing financial mistakes. In addition, financial education helps you make more conscious decisions, allowing you to act according to your expectations and needs.
In this sense, one way to avoid these mistakes is to plan and have the discipline to follow your goals, buying what you need without extrapolating your personal finances. It is also worth avoiding impulse purchases.
For that, analyze if you really need to make that acquisition. Another relevant point is to define the maximum amount to spend on the end-of-year festivities. A tip to help with this task is to calculate how much of your income will be left after paying fixed bills.
Then consider the extra expenses and set the maximum ceiling to use in the festivities. Here, set a realistic goal and control yourself not to exceed the proposed limit value. Still, it’s worth setting a limit to spend on gifts, listing the main people you’ll gift.
In this way, it is possible to know how much money you can spend on a present home. And don’t forget to avoid going into debt with these purchases, as the beginning of the year is a period with higher spending.
Now you know the top 5 financial mistakes that can hurt your budget at the end of the year. Avoiding them is essential to keep finances in order even in a period when expenses tend to be higher. This way, you have the chance to start each year with more peace of mind and budget clearance.
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