A financial expert has revealed how to manage your money – and the three things you need to stop doing unless you want to be poor forever.
Financial advisor Dr Brad Klontz recently shared the common mistakes ‘almost everyone’ makes while planning for their future
Dr Klontz also warned against abusing credit cards because the interest tends to pile up and set you back even further.
‘You need to budget every month and never spend more than you make,’ he said.
Dr Brad Klontz is a financial psychologist and professional advisor
1. Abusing credit cards
While some may benefit from using credit cards the right way – many often make the mistake of spending more than they can pay off.
‘Do not use your credit cards unless you can pay the full bill each month,’ Dr Klontz said.
‘Credit card interest can be as high as 36 per cent – which is just extra money you’re handing over to the bank.
‘Those cards can’t be trusted. If you keep having trouble with credit cards, you should seriously consider cutting them up and never using them again.’
2. Spending more than you make
Dr Klontz shared that if you can’t afford to save and invest at least 10 per cent of your income for your future, you need to make big lifestyle changes.
‘Maybe you need to get a smaller place or sell your car and ride the bus,’ he said. ‘Or maybe you need to save money on haircuts and shave your head, or find another source of income.’
He added, ‘You’ve got to make investing for your future your top financial priority today.’
3. Investing the wrong way
‘Investing the wrong way hurts so many hardworking people who just want to make a better life for themselves and their family,’ Dr Klontz said.
‘Rich people invest very differently than most people do. Poor people stay poor by trying to trade their way to fast wealth.’
He recommended looking into long-term plans that offer a higher yield for a lower risk.
Many thanked him for his advice.
‘Never had a credit card in my life,’ one said.
‘Good advice, thank you for that information!’ another added. ‘Live below your means! Just because you can afford a 500k home doesn’t mean you need one, buy a fixer upper and pay it off early.’
But others claimed he was ‘out of touch’.
‘You need to update your advice. 80 per cent of people live paycheck to paycheck,’ a woman wrote.
‘Sell your car and ride the bus? Come on, what reality are you living in? Some areas don’t have public transport,’ another said.
‘It’s called inflation and skyrocketing housing prices,’ a woman said.