Big Picture, Financial Planning, Millennials

The Most Dangerous Phrases In Personal Finance

When it comes to your finances, you might be your worst enemy. Constantly making poor choices and coming up with justifications for each decision is a formula for disaster. 

Most people convince themselves that what they are doing is okay. Here are some of the most dangerous phrases people tell themselves that lead to poor financial decisions that you should avoid:

  1. “I deserve this.” This is something people often say before they make a spur of the moment, huge purchase. Instead, take a week before you make any huge purchases, this will help you avoid splurging on things you don’t actually want.
  2. “I will save more next year.” It is so easy to get wrapped up in the idea that this year had a bunch of random expenses but next year will be different. In life, every year you are going to have random expenses and surprises pop up. You have to be aware of that, plan for it, and still find ways to save.
  3. “I will get that done when I have more time.” I have heard people say this about budgeting, estate planning, life insurance, etc. way too many times. This is a dangerous game to play. What happens is you continue to push it off, then do not get it and risk some major problems for you and your family. Put important action items to the top of your to do list and do it! Hold yourself accountable.
  4. “I am waiting for the market to stop being so volatile before I put my money in.” People all the time act like they know the direction of the markets and can time it. Just look at the last week, the market has gone up over 3% in the last 5 days when there are no real good economic indicators. This is just how the markets work. The best days are intertwined with the worst and you do not want to be on the sidelines waiting. You will just end up buying back in later than you want!
  5. “I’ll do it when…” I think Treyton had a post awhile back about this, and it may be similar to what I said above, but any phrase saying you will do something in the future is dangerous. Examples: “I will save when I make more money.” “I will start budgeting when I have more time.” Any of those phrases will come back to bite you in the future!
  6. “I know it wasn’t an emergency, but I had to use these funds.” This can be such a dangerous habit to build. Using money from your emergency fund to buy things you don’t need is something you want to get used to doing.
  7. “It’s fine, I will be able to afford it next year when I get a raise.” Never buy something you cannot afford right now based on a raise you THINK you will get in the future. You never know if that will come. Just wait.
  8. “I am bad with money.” So many people just say they are bad at money as an excuse to spend it horribly! Anyone can learn, it’s a skill!

Try avoiding these phrases at all costs! It will lead to better financial decisions for you! 

Disclaimer: None of this should be seen as advice. It is just for educational purposes.