Failure to delay gratification
Many people think of the here and now, rather than the then and later. I’m a huge advocate of living life for today – however, I realise when it is time to focus on my priorities.
When it comes to money – try to think about the uses and options it will provide to you in the near future. Discounting compound interest, small amounts of money can go an extremely long way – only as long as you’re willing to live below your means.
If you are on a £25-30k salary, try to live on an £18k salary – the rest should be put away for a rainy day. Some people ignore the positive effects of delayed gratification.
Small changes always bring about massive results over time.
This is a fatal mistake the majority of people make, and it’s unmistakeably the main reason I feel people struggle to pay their bills. I would describe myself as being very good with numbers and mathematics, but recently I incurred a £25 charge on my account. Even with a budget plan that has been balancing itself very well for a long time. There were hidden intricacies that I was unaware of.
The point I’m trying to make is – do not create budget plans inside of your head – they don’t work, unless you have a scientific calculator installed at birth! Create a budget plan to suit your specific needs.
Falling Into The Trap of Store Cards and Credit Cards
I will never fall into this trap.
Store cards may seem convenient and helpful, however their main purpose is to get you to spend money you don’t have on things you well and truly know – you don’t need. Only so you can pay for them at a later date and if you miss the set deadline – you’ll pay even more money.
“Oh a £250 spending limit.”
Have you ever asked yourself whether you will be able to afford those items at the end of the month?
Some store cards like the Tesco Clubcard and other similar grocery store cards are actually useful.
So there you have it! Above are the three reasons I believe people struggle to pay their bills on time and without accruing any late payments; failure to delay gratification, not having a budget plan and falling into the trap of accumulating an unnecessary amount of store cards and credit cards.