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Tuesday, April 08, 2008

Seven sins in financial world.



Lawra rowley wrote an awesome article about The Wages of Financial Sin Is Debt (Among Other Things) on yahoo!finance.

The article is all about handling your money inefficiently can put you through ''a life of living hell''. We can read the stories of famous people like Mc Hammer who has an outstanding debt of over 12 millions and still not be able to pay back and Michael Jackson urged to sell off his Neverland Ranch and all his wealthy stuff to pay off the debt. See, no matter how good you are in the way of making money,if you fail to manage, living extravagant life , your money will knock you down so hard that won't be able stand up.

''Commit these violations, and you'll create a financial hell on Earth for yourself''

..and the seven deadly sins are:

Sin No. 1: Failing to identify what thy money is for.
Set up the priority list about what to do with your money by the time you received your paycheck rather than buy things that you don't need.
''If you never take the time to figure that out, and don't set priorities and write down specific goals that you want your money to help you achieve, I guarantee you'll never run out of ways to squander your
cash.''
Sin No. 2: Not living within thy means.I
It's all about budgeting, your expenses must not exceeds your your income or else, you will make your own 'hell on earth'. Track your spending wisely, save your money, and live like the average people.

''The temptation seeps into the unconscious through the subliminal
seduction of television, advertising, fashion, the neighbors' kitchen
renovation, the number of luxury cars in the parking lot at work, or, in my case, a few mouse clicks. ''
Again. Stick to your budget, kill your temptation and don't let it stay on your mind.

Sin No. 3: Believing that material wealth will solve all thy problems.
Don't buy expensive things like BMW car that you can't afford to buy just to show off to your friends.

''We think money is power, status, security, freedom, or a host of other things. ''

Sin No. 4: Shopping while feeling sorry for thyself.
My friend got frustrated about his bonus payment recently, and he bought the expensive phone (HTC phone) that he didn't need. He said that he really need to buy something nice for remedy because he only entitled half month salary bonus this year.

''A new study finds that people who spend money while sad or self-absorbed unconsciously overpay. This differs from the more well-known phenomenon of retail therapy. ''
Life is full good things and bad things, you have to face it. If bad things happened, learn how to overcome sadness. Don't buy luxury items when you feel heart-breaking, it only makes you feel more miserable when you look back into your financial situation in future.


Sin No. 5: Not saving for college because thou expects financial aid (or a higher power) to take care of it.

''A study by AllianceBernstein Investments found that 87 percent of parents believe scholarships and grants will pay for at least part of their children's undergraduate expenses. ''

I already made my financial moves of saving for my son's college fund.It is my responsibility as a father to contribute some money for my son's higher education. Every child should have the right to enter a college or university and they should get financial aid from their parent.

Sin No. 6: Receiving a whopping refund after filing thy tax return.

Sin No. 7: Not saving for thy golden years.
Saving for retirement is a vital step for us because we don't know whether we can financially support ourself when we get old and grey. Educate yourself on how much to you want save your retirement and how to make it work.



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