People have to deal with money throughout their lives, so everyone needs to manage finances, but there are always only a few people who can manage finances successfully. The reason is probably that most people do not have a correct understanding of financial management from the beginning, so they continue to make mistakes in the process of financial management. In order to help everyone avoid detours in financial management, Aishengxi has summarized some of the most common mistakes in financial management for your reference.

If you have enough money, you don’t need financial management

This is the most common mistake made by some young people who have just left school and have a good family background.

In addition to their normal salary income, their family members have more or less financial support for them, so they have no urgency to manage their finances. Often, when you have money, you spend more, and when you don’t have money, you spend less. You are so leisurely that you don’t have to worry about financial management.

But if you think about it carefully, they will soon face the problems of getting married and buying a house in a few years. As their parents' age continues to increase, they also have to consider their parents' retirement and pension issues. Especially if a family member suddenly becomes seriously ill and needs a lot of money, the parents' savings alone may not be enough.

As an independent-thinking young person, you should not be a burden to your parents, but you should plan ahead, enhance your family's ability to withstand risks through financial management, and be fully prepared for a high-quality life in the future.

Wait until you have money before you manage your finances

Many people think that the current living expenses are too high and they cannot save money, so they want to wait until they have spare money before they manage their finances, or they think that it is not appropriate to manage their finances. It's a matter for rich people and has nothing to do with you. In fact, it's just the opposite. The less money you have, the more you need to manage your finances. For wealthy people, as long as they don't spend money carelessly, bank interest alone may be enough for daily expenses, and the urgency of financial management is not that great. But the poor are different. If they don't know how to live a careful life, they are likely to become poorer and poorer and fall into a vicious cycle. For people who do not understand financial management, family income is relatively stable, but family expenditures show great randomness. Especially for some large expenses, many people often make a decision on the spot, then swipe their credit card, apply for installment payment, and finally drag themselves into the abyss of debt.

So, whether you have money or not, you need financial management, and you need financial management even more if you don’t have money.

Equating financial management with investment

When we talk about "financial management", we often say "investment and financial management", so many people equate financial management with investment. But in fact, even if understood literally, there is a difference between the two. Financial management means to "manage" one's own "property". Investment is a very professional term, which is the process of converting money into assets. In addition, financial management and investment pursue different goals. Financial management pursues balance of payments and preservation and appreciation of assets; while investment pursues maximizing returns and using money to make more money.

Of course, financial management also includes part of investment, so the connection between the two is very close, which is why we often mention "investment and financial management". But a close connection doesn't mean the two mean the same thing. If you treat financial management as investment, it will easily become "the more you manage, the less money you have", because professional investment is not suitable for everyone.

No financial goals or unclear financial goals

The ultimate goal of financial management is to achieve family financial goals. Only with clear goals can we formulate corresponding financial plans, and only then can financial management be targeted. .

Many people do not consider financial goals when managing money, but simply pursue more money. They will run around like headless flies, playing whatever they feel they can get money quickly, and in the end they will lose even their principal.

Some people think they have financial goals, for example: they want to live a comfortable life after retirement; they want to buy a bigger house, etc. However, these goals are not clear enough and must be made concrete and quantitative. For example, if you want to change to a larger house, which location should you choose? How big is the area? When will the plan be completed? These contents must be made clear. It is best to first find a similar house on the real estate agency website, and then use the price of this house as a reference. This is a clear financial goal. Of course, when making financial planning, you must also consider the issue of rising housing prices. In addition, the completion time must also be controlled within a reasonable range, because reasonable goals should be achievable and achievable.

Pursue safety too much in financial management

Many people, especially the elderly, keep most of their family property in the form of bank savings for safety reasons. Of course, among all types of investment and financial management, savings are the one with the least risk and the best liquidity. But at the same time, savings also have the lowest returns and cannot resist inflation, and the money in your hands will only become less and less valuable. Although it is said that "investment is risky and you need to be cautious when entering the market," we cannot pursue safety too much and ignore the preservation of asset value. Otherwise, the safest place will become the "most dangerous".

In fact, we can improve the security of financial management in two ways. One is to diversify investment risks through reasonable asset allocation; the other is to continuously improve one's financial management capabilities through continuous learning.

Insufficient understanding of risks

This is exactly the opposite of the fifth mistake just mentioned. People who make the fifth mistake are too conservative; while people who do not have enough understanding of risks And tend to be too radical. The big pit that almost all investors will fall into is "excessive expectations of investment returns and insufficient understanding of investment risks."

We must clearly realize that high returns must be accompanied by high risks. As a financial manager, you must understand that what you pursue in investment and financial management is "value preservation and appreciation", rather than the "maximization of investment returns" pursued by professional investments.

Financial management is not a way to get rich, but an economic activity that involves risks and benefits. Only by paying attention to and preventing risks can it be possible to achieve investment returns and achieve expected financial management goals.

Otherwise, it may be "all in vain".

Therefore, investors cannot only look at returns without looking at risks. When making financial investments, risk prevention should be given top priority.

In addition, there is another type of risk that is often overlooked by us, and that is "personal risk". The sky is unpredictable, and people are prone to misfortunes and blessings. When unexpected risks come, many families will suffer a huge blow. For personal risks, the best solution is to purchase insurance and transfer possible risks to the insurance company. Many people have a preconceived resistance to insurance and think that insurance is of little use. These views are very one-sided. Although insurance cannot generate investment returns, it can provide the most basic protection for individuals and families.

Superstitious experts

Many financial managers like to follow the trend of investment. When they hear what others say to invest in making money, they invest in whatever they want without thinking about the logic behind other people's investments. They often like to listen to experts. If an expert says it is good, it must be good. This is also the favorite method of the hand-in-hand party: only seeking results, not asking about the process. But in fact, experts cannot control the ever-changing investment market. If the market changes drastically, it will definitely be these hands-on parties who suffer.

In fact, there is no so-called good or bad distinction between financial products and investment varieties, only the difference between suitable and unsuitable. Everyone must consider their own risk tolerance and actual needs before choosing the right product. In addition, you can listen to what experts say, but you should not trust them lightly. The best strategy is to think about the principles behind what the experts say, and then summarize an investment strategy that suits you based on these principles.

Borrowing to invest

Some people are overconfident in their investment abilities, but have insufficient funds on hand. Therefore, in order to expand their results, they borrow money from others to invest. , Some people even borrow loan sharks to invest in order to make a lot of money in a short period of time. But many times, investment is not only about personal ability, but also closely related to the overall development trend of the market. When the market fluctuates, people who borrow money to invest often cannot control their mentality and are prone to make impulsive operations. In the end, there is a high probability that they will lose money, or even go bankrupt.

In addition, some specialized investment products are actually borrowed money investments in disguise. Try not to participate in this type of investment products.

Investment is too concentrated or too diversified

As the saying goes, "You cannot put your eggs in one basket." You should invest in a variety of financial products to achieve the purpose of diversifying investment risks. Although the principle is good, deviations will occur when it is actually applied. For example, some people have invested in so many varieties, including funds, stocks, gold, futures, bank financial products, online loans, etc., that in the end they have forgotten what they invested in. At the same time, he did not have enough energy to take care of it, and in the end it was a thankless effort, which not only delayed his own work, but also made no money in investment.

Lack of planning in financial management

As mentioned before, financial management must have clear goals, which are also family financial goals. After having family financial goals, you must formulate corresponding plans to achieve these goals. This plan is actually financial planning.

Financial planning is the advanced stage, or the final stage, of financial management.

The above are the 10 most common mistakes in financial management. When we know these mistakes, we should try to avoid them so as to avoid detours, achieve family financial goals as soon as possible, and achieve financial freedom.

For people who have no money, do they no longer need financial management?

Xiao Aixiang: For those who have studied financial management for a period of time, the answer to this question is yes: financial management is definitely needed.

In the book "The Richest Man in Babylon", there is a suggestion on how to make yourself rich, which is to save, and then look for opportunities to turn your funds into powerful assets, and then Abundance.

Here is a story: the story of the camel merchant. The story goes like this, "In the early days when he was still very young, he was attracted by various expensive goods, and then continued to borrow money to satisfy his vanity. Finally, due to these vicious debts, he was forced to leave Babylon. After leaving Babylon , his life has not changed much. He was caught for committing illegal acts of robbery and was finally reduced to a black slave. After experiencing ups and downs, he realized that he could only return to Babylon to repay his debts and at the same time, give up ten percent of his income. One is saved as savings to lay a solid foundation for future financial gain.

"This example is the same as the above saying that we need to manage our finances even more when we have no money.

When we have no money, we should control our expenses and prepare for our future. Only in this way can we have the opportunity to develop , Raise a golden goose to benefit yourself and your family.

Wealth, like the growth of trees, needs a seed to grow into a towering tree after careful watering. The better?

Now that we understand the importance of financial management, what financial knowledge should newcomers learn?

1. Keep accounts and analyze your own income and expenditure.

So-called The most basic step in financial management is to sort out your financial situation. Therefore, it is important to learn to keep accounts, especially to record your income and expenses regularly and optimize those unreasonable expenses. p>2 Make a good career plan and increase your income from work

You can share more knowledge related to your major, or participate in more offline activities and accumulate connections. Good professional training may help you. Your future salary will double. Of course, if you work for a long time, the editor recommends that you keep in touch with headhunters and establish your own project records. In the workplace, the most important task is to do your job well, not only for salary. In order to accumulate experience and improve abilities

3 Use part-time jobs in your spare time to enrich your sources of income

Nowadays, in addition to their own jobs, many people also publish books through sponsorship. Make your hobby one of the ways to make money by setting up a column to share your life experiences, or travel shopping. In short, you can use your expertise to do interesting work and enrich your sources of income.

4 Carry out reasonable financial planning and gradually achieve it

Financial planning refers to setting a goal that needs to be achieved in the near future, and then conducting financial management according to the expenditure required for the goal (for example, buying a house in 1 year, buying a house in 2 years Then buy a car, start raising children in 3 years, etc.). Then according to the plan, make corresponding career plans, savings and even investment and financial management plans.

If you can insist on doing the above four points, I believe you will be one step closer to your small goal of "winner in life"?