One of the most shocking pieces of information that most people eventually discover is that their spending habits can literally control their lives.
While most people want to believe that they have full power over what they spend, habits are what truly set the pace for what ends up being spent or saved. Realizing that habits have a dramatic impact on how much money we have is the first step in taking control, but after that, critical decisions must be made in order to create a life of wealth and freedom.
This summer, avoid making terrible financial decisions by understanding how to get rid of the worst of the offenders. The following three bad decisions are some of the worst that can be made, and anyone would be wise to eliminate them from their day-to-day habits.
Treating Free Time as Leisure Time
One of the worst lies ever told can be found in the idea of “free time.” Time is the most precious part of our lives, and it is something we spend whether we like it or not.
All time is valuable, but how it is used changes how valuable it is. Most people’s idea of free time is actually leisure time: Relaxing, slowing down and letting go of responsibility is important, but it isn’t free.
It serves a clear purpose and it produces certain results. Free time could be used to learn a new skill, start a project, work on an existing project, search for ways to bring value to one’s life or even get some work done around the house.
Use this summer as the season of transforming free time into a precious resource that can be used to make life unimaginably better.
Investing Outside Of Yourself
Most people think in terms of spending and saving, but rarely do they consider what they buy to be an investment.
If a person buys a can of soda, they’ve invested in that soda. They’ve given away their money and hope for something in return. However, what if the soda isn’t doing them any favors? What if it’s only helping someone else and might actually just be hurting them?
These questions can lead to a powerful epiphany: we could already be better off if we had invested in ourselves more yesterday.
Instead of spending money on a soda, we could have had clean water and a little more money. Instead of buying a movie ticket, we could have had one of the most important books we’ve ever read.
The best way to invest is in what returns the most while risking the least. This summer, treat money as a tool for becoming more valuable as a person.
Our minds and bodies are capable of just as much as many self-made millionaires. By spending more money to improve ourselves, we move closer to our true potential.
Neglecting The Money Flow
Finally, one of the most sinister ways that people go broke is slowly but surely.
Instead of knowing how much money they’re spending each day or how much they could be saving, they simple go about their routine and allow advertisements, impulses and friends to influence where a significant portion of their money goes.
They are helpless in their own financial future because they don’t realize what’s eating away at their financial freedom.
In order to create a strong financial outlook, we have to keep a watchful eye over our money.
For example, some people lose all of their money on small purchases. They think that because something isn’t that expensive, they can afford it, but they make that mistake over and over again.
Most of their money ends up leaking right out of their pocket.
This summer, remember to keep a close eye on what’s being spent, what’s being made, and try to find the little places where a little bit of money seems to disappear. A leaky cup always ends up empty, and a person that doesn’t watch the flow of their money always ends up broke.
Photo: Rajarshi MITRA / CC 2.0