The Budgetarian

3 steps to ruining your personal financial goals in 2021

Halee Andrea Alcaraz - Philstar.com
Growing one's money doesn't have to be complicated. The rules can be simple, and one of the best advice to take is to pay credit card debts in full every month.
Andrew Wilus via Pexels

We just completed the free trial of 2021 that is January and February—or so we’d like to think. As we progress into the year, some of us are still looking to get our lives and finances together.

For investing advocate Jed Velarde there are "sure-fire ways to get financially stuck" in 2021, which in theory, should be a better year than 2020.

In a guide he penned for COL Advantage, a platform of online stock brokerage COL Financial, Velarde listed three ways for anybody who's trying to earn to fail in the process of building toward large purchases or life goals.

Step 1 is simple: Let go of goals.

The simplest and quickest way to avoid attaining aspirations is to not plan at all, Velarde writes. It is a lot easier not to set any vision of the life you want.

People should instead follow the good ol' SMART planning, or the setting specific, measurable, attainable, relevant and time-bound goals, Velarde advises.

For those who have credit card debts, it would be a good idea to follow financial experts' advice who keep reminding people to pay off their cards in full every month. Otherwise, you become an expert on negative compounding, Velarde said.

Negative compounding happens when one does not pay their dues on time and the interest that is due and unpaid will add up to the outstanding principal. It then becomes eligible for interest payment, and the outstanding amount will increase exponentially, he explains.

If you want to get financially stuck, “let those debts snowball over time and just let your future self figure out while you enjoy today."

Step 2: Never budget, save or invest.

If you're comfortable with missed opportunities, there are three Ds to do it, Velarde writes:

  • Delay investing in the stock market, which can generate great returns;
  • Deny the fact that the market can always recover and reach new high; and
  • Dismiss the potential gains that could be achieved when investing early in the stock market.

Another way to trip financially? If you keep buying things you don't need and you convince yourself that saving money is just too hard and growing it is just too complicated.

And while practicing these, “Just hope that things will still go well for you and assume that you will never build a family, never grow old and will never retire,” Velarde writes, adding that such a careless perspective would give you an easier time, after all. Why bother?

Step 3: Stop learning

This is quickest way for a person to be in financial disorder, Velarde writes. Not listening to financial experts and not bothering to participate in educational seminars are missed chances for learning.

A possible effect is that people get into investment schemes they believe can earn them quick cash without checking with the Securities and Exchange Commission for their legitimacy.

“After all, who can resist the promise of ridiculously high rates of return?” Velarde ask. "Those get-rich-schemes are too good to pass up. It’s so good. Too good."

When something sounds too good to be true, it should already raise suspicion.





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