9 Things You Should Never Do With Your Money

It¡¯s time to get a handle on your money, stop overspending, start saving and finally figure out what exactly is going on with your retirement account... these are things we've all thought about but few of us have acted on them. Like it or not, Millennials, unlike baby boomers, are little behind in the money game.

From not being aware of a savings plan that suits your needs to being reckless spenders, there are multiple things that we Millennials need to consider. There are probably a hundred things you shouldn¡¯t do with your money but here's a smarter, more realistic list to help you figure out the 'money stuff':

1. Not keeping an emergency fund

One of the most noticeable patterns among Millennials, unlike the generations before us, is that many rely on friends or family when it comes to a sudden financial emergency. The urgency to save up for an untoward situation doesn¡¯t quite figure as essential for many. It's a better than good idea to keep three to six months' salary in the emergency fund. Keep the emergency fund in fixed deposits or liquid funds to enjoy high liquidity.

Also read: Looking For Ways To Manage Your Finances Better During The Pandemic? Here Are A Few Tips

2. Ignoring insurance

Be it student loans, buying or renting a place to live, or having kids one day, all these events will need one to purchase insurance. These major life events make it extremely important to have a financial security net. Insurance provides an essential financial protection for your future and, so, no matter how complicated it sounds it's important to learn its benefits and start investing some money in it.

3. Not sticking to a budget

Have you ever taken Rs 10,000 out of an ATM and wondered later where it went? Start keeping a daily spending diary to keep track of where your money goes. Try it out for one week and you'll be amazed at how much you can spend on the little things like coffee, eating out and entertainment. Take a blank piece of paper and create a column for each day of the week, Monday through Friday. Put the piece of paper in your wallet or purse - somewhere where you can have it with you at all times. Make a note of every single penny that you spend, then tally up at the end of the month for the real picture.

Also read: How To Manage Household Finances Better In The Middle Of A Pandemic

4. Living paycheck to paycheck

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Living paycheck to paycheck means not saving anything and where all income goes towards expenses and obligations. According to this report, 57 per cent of all Indians have less than Rs 5,000 in their savings account or emergency fund. 54 per cent of Generation X Indians have more than Rs 50,000 in a savings account. The national average is 16%.

5. Sharing your card details over the phone

Your phone transactions may sometimes involve raising money for legitimate organizations. But there¡¯s the whole network of con artists waiting to scam well-meaning donors who have no clue of the trap they're falling into. It is for this precise reason you should never give out your credit card number over the phone.

6. Shopping when you¡¯re feeling, well, emotional

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It¡¯s best to avoid shopping when you¡¯re feeling down because you might be tempted to spend more in order to feel better. When you are emotionally vulnerable, it's hard to dodge a pushy salesperson who wants to sell something that you have no interest in buying. Invest your energy and money in something more profitable like mutual funds and see the difference.

Also read: 8 Ways The Indian Millennial Can Manage Money Better

7. Spending money on things you don¡¯t really use

Of course, sales with half off on everything can seem tempting. However, stocking up on those extra scarves, bath sets, candles is just another way you're literally wasting your money. Consult the aforementioned points to invest your money better so you can truly reap the benefits.

8. Getting trapped in scams and 'deals' online

According to an Economic Times report, nearly 56% Indians fall for discount scams online that lead them to sketchy websites. More than 35.4 per cent of Indians confess to having been conned by discount scams, where a malicious file was downloaded onto their device. To avoid falling into these traps it is important to use a comprehensive security protection software which can help protect your device against malware, phishing attacks and other threats. Always verify the source and the validity of websites that you log on to and never reuse your password.

9. Living above your means

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One of the most important steps towards saving and building wealth is to live below your means. Look for avenues to invest your money. Search for higher dividends if a secure and comfortable future is what you seek.