This is a collaborative post by Ellie Jo with information on money traps to avoid.
Money Traps to be Aware Of
Money is a trap in itself. You think you have lots, then all of the sudden you have hardly anything to fall back on. But, if you know how to avoid said traps, life actually does become a lot easier. Truth is, we do make things a lot harder for ourselves. We just don’t realize we’re doing it at the time. That’s why money is such a trap in general. There are plenty of little traps that are set along the way for us to fall into. If you want to live a happy and wealthy life, then you need to know what paths to go down, and which ones you really should be avoiding. So, if up until now you’ve had a terrible time with money, then let us solve it slightly for you. Here are the biggest money traps you need to be wary of, and how we think you can avoid them.
Bad Loans & Good Loans
There definitely is such a thing as bad loans and good loans. Sometimes in life, you need a helping hand from a loan, which is completely fine. But you really need to know what to look out for if you want to get yourself a good loan. A good loan is always one with a low-interest rate, no hidden fees, and a strict contract that you can both stick to. You will be surprised at how many loans promise an offer for the first year, and then bump up the price for the rest. One of the most common loan is an auto loan, and there are some good ones to be found, you just have to make sure you go to a reputable company. Auto loans online are really easy to find as well, just make sure you’re reading customer reviews of people who have taken out the loan previously. It might open up your eyes to some of the dangerous ones. And always make sure your finances are going to be able to afford it long term.
There will be many contracts that you’ll get yourself into as your years go by. Phone bills, home bills, work contracts… the list could go on. One of the biggest you need to be mindful of is your phone contract. While it might seem like a good idea and your only option to begin with if you want a brand new phone, you’ll always get stung later on down the line. They might put your price up once every year, and the fact that you’ll still be paying such a high price a month for a phone that will be worth less as time goes on won’t be worth it. Consider whether paying for the phone outright would be your best option!
You’re going to be your biggest trap when it comes to this. Spending too much is an easy habit to fall in to, so you just need to make sure that you’re controlling what you spend, and we recommend using an app. It can allocate you a certain amount of money each week to make sure you stay in budget, and maybe even get some savings behind you!