October 22, 2013

6 Pitfalls That Could Destroy Our Budget

After the disaster left by Santi storm I just realized that the major expenses we can experience is during the emergency like aftermath of storm, earthquake and other natural disasters. We need to make sure that aside from saving money for future use we also need to save just for the sake of emergency purposes like the event of hospitalization and during the disasters. After Santi storm I do not have any choice but to use up my entire budget and even use my other savings for food, water, generator, gas, and rechargeable lights.

1.   Credit cards. These plastic is understandably tempting but we need to know that the money we use out of credit card is not our own money. Do not bring this plastic during malling or window shopping or you will end up buying things that you don’t actually need. But some prefer to keep one for emergency situations but it is best not to have one and just use your emergency funds or savings.

2.       Impatience in planning or savings. Oftentimes problem arise when people set financial plans or goals but lose patience in completing the savings programs. For example, let’s say an individual set aside money for a new 3d LED TV every payday, then pass by on appliance store and have urge to buy the TV he love using credit card that has a charge of high interest rates.

3.       Lack of adjustments. A budget is created using a set of expenses and income figures that current at that time. As these figure changes, it is important that the budget is adjusted for these changes.

4.       Holidays. Unfortunately we cannot prevent holidays and this can spoil our budget. It is important that we plan and adjust the budget for special occasion which need substantial amount of money for presents, food, dress, decoration and etc.

5.       Vacations.  Vacation can also spoil our budget our budget especially some necessity things like food, water and other expenses that are obviously higher in other tourist destination places. If you can bring foods like noodles, water and crackers do so for you to be able to manage your budget.

6.       Emergency situation which already discuss in the introduction of this post.

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