If you read my previous post, you may come across some post where I shared briefly on the Financial mistake that I made when I started working. Aside from PTPTN Debt & Personal Loan Debt, I got myself into Credit Card Debt not once but twice.
It may sound shocking to you especially for someone like me that currently are doing my part to share about Personal Finance & Investment. Coming from a not so well to do family, I don’t really have good privilege to spend or buy stuff easily. So when I started to work, I had a mindset where I think that I can just spend or buy whatever that I want since I didn’t get to enjoy such privileges when I was young. That mindset have caused me to make chains of mistakes & trust me, those lessons are really hard on me.
So What Are My Financial Mistakes?
1. No Financial Plan
I literally have ZERO Financial Plan. I remembered when I started to work at 2007 with salary of RM1000 (RM880 after EPF deduction). First thing that I did is to get myself a brand new Naza Suria with monthly installment of RM450 x 9 years loan when I already had a Perodua Kelisa from my brother with installment of RM350 + 2 years repayment left.
2. No Savings
With salary of RM880 – RM450 Car Loan, I wonder how can I even save my money. Even after I got higher salary, my savings were way lesser than what it was supposed to be. I remembered after I managed to save RM3000 from my Mutual Fund Investment & sold it later for my Phuket trip.
3. Not Believing in the Power of Compounding
I remembered back in those days when my Mutual Fund Agent approached me & shared the importance of Compounding, a young & egoistic me was being really skeptical towards it. How important the Power of Compounding? You can read my post about the Power of Compounding HERE.
4. Not Exposing Myself to Financial Education
Honestly, I had No Idea at all on How to Manage Money. The only way I learned about it was after I got myself into bad financial debt. Right after that, I started to read more books & blogs to learn how to manage my money.
5. Overspend & No Cash? I have Credit Card 🙂
This is how I got myself into huge debt. My mindset was to spend first & think tomorrow or carry forward my repayment to next month. Guess what, I’m unable to cope with my Credit Card repayment. I even got myself a new iPhone TWICE with my Credit Card without having any idea how to pay it.
6. No Insurance
This may not be a direct link on how I got myself into debt but I think that Insurance should be part of your Financial Planning just in case there is any emergency. PS : I only got mine at 28 years old. Thank God there was no major sickness or hospitalization happened during that period.
What Should You Do To Avoid These Mistake?
Rule No 1, avoid all the mistakes that I did. Rule No 2, don’t forget Rule No 1. It is that simple. If you don’t have any Financial Plan at the moment, you should start to PLAN now. Or if you have no idea How to Plan Your Financial, you can read my previous post HERE. If you are in a situation where you have DEBT, you can refer my previous post on How To Pay Your Debt Fast. Don’t spend your Future Money. It’s really bad especially if you cant pay it.
Because of my past Experience, I am a better Financial Planner now. Did I have hard time paying off my debt? The answer is YES. Do I regret my past Financial Mistakes that I did? I don’t regret it at all. To be honest, I am glad that I went through all that Mistakes & that Experience have thought me a lot about Financial Planning. This whole process did change my life & that is why I committed myself to write this BLOG. I want to share my experience with all of you so you are able to avoid the mistakes that I did in the past & to also share my Investing experience with all of you.