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Financial mismanagement is the reason you don't have a credit card in your wallet right now. Want to know how to avoid this? Read the text to the end and discover essential practices to help you achieve financial balance.
Dear reader, did you know that lack of financial control is the reason why you are not approved for credit?
One article recently published by Uol reports that most Brazilians do not have a credit card due to restrictions on their name and financial problems.
Does this happen to you too? Have you ever spent more than expected and had your name negatively impacted?
This situation is common. But fortunately, there are several techniques to help reverse the problem in your favor.
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In this article, we will teach you 3 extremely important pillars to improve your financial health.
So, continue reading carefully and find out:
- What is the main cause of financial mismanagement?
- What are the signs of financial mismanagement?
- 5 steps on how to effectively avoid financial mismanagement;
- Can I have a credit card in this scenario?
What is the main cause of financial mismanagement?
Initially, according to studies in Economic Psychology, one of the main causes of financial mismanagement is lack of planning and the strong pressure for consumption.
Along with these habits, there are also reasons that contribute to financial mismanagement:
Need to belong to a group
A very present cause among us is the need for identity. In other words, the desire to fit into a certain group in order to establish social relationships.
In fact, the situation has nothing to do with “friendships based on interest”. But rather, in spending money we don't have on clothes, restaurants, parties and outings for a certain social group.
Compensation
Another reason for your financial situation to go into the red is linked to the search for compensation.
In other words, people seek to fill the void in their hearts by emptying store shelves, often driven by unbridled consumerism.
Momentarily, the feeling causes a few moments of happiness. However, when the feeling ends, the need to consume again comes.
Has this situation ever happened to you? Of course it has!
Mainly among women, who end up relieving the stress of everyday life at the mall by buying bags, clothes and shoes.
The sad thing about this is that almost 80% or even more of the items purchased in this package end up stored inside the wardrobe. Without use or any kind of utility.
Lack of financial planning and clear, defined objectives
We know that most Brazilian consumers do not have the habit of planning, nor do they set financial goals and objectives.
Knowing where you are, knowing the reality and the amount available for spending is an extremely important condition for improving your financial health.
After all, this practice prevents impulse spending and debt!
What are the signs of financial mismanagement?
One way to find out if you have a certain type of lack of control over your finances is to pay attention to the signs.
Try to see this as a self-assessment. Write down your difficulties on a piece of paper and then develop strategic plans for improvement.
5 signs that you are suffering from financial mismanagement⤵️ ⤵️ ⤵️
1 – Your income doesn’t last the whole month
Who hasn't? If this happens to you, mark an x on the spreadsheet provided below.
One of the first signs that you are suffering from financial mismanagement is that your salary is not enough to last the entire month.
2 – Bills always late
Do you usually pay your bills after the due date? Or worse, do you have a pile of overdue bills to pay?
If this happens in your life, it is because your financial health is not good.
No matter how low your income is, there is the possibility of achieving financial balance, setting wealth goals and getting out of the red.
3 – Name restriction
The hottest sign of financial mismanagement is a restricted name. This situation usually happens when we spend more than our monthly income.
In fact, a bad credit rating is one of the most damaging factors to financial health and prevents consumers from obtaining credit on the market, financing, renting a house, cheaper interest rates, among others.
4 – Not having money for unexpected expenses
Did the car break down? Did my child get sick? What do I do now? I don't have the money to cover these unexpected expenses!
Surely, if you have reached this part of the reading, you have already repeated the phrase quoted above dozens of times. Haven't you?
Unfortunately, unexpected expenses are one of the factors that most often lead people to lose control of their finances. And in some cases, they end up causing a snowball effect.
But this happens because the individual does not have the habit of building up a financial reserve.
Therefore, if the situation has already happened to you, even if your accounts are up to date and your name is not on the SPC, this is also a sign of lack of control.
5 – Borrow money
Just like not having a financial reserve, borrowing money is a sign that your finances are not in good shape.
If you identified with this item, it's time to start an action plan.
5 steps on how to effectively avoid financial mismanagement!
If you are in the red today, don't worry. There are ways to reverse this situation.
Best of all, the tips below can be put into practice immediately.
Step 1 – Recognize the problem
The first step to take is to recognize the problem.
If you assessed yourself in the previous topic and have already accepted that this is an existing problem, congratulations! This is already the beginning of your change.
Step 2 – Plan Ahead
The next step is to execute strategic planning to get out of this scenario.
Therefore, during this stage, establish your financial goals.
Certainly, at the beginning there are two very important ones: get out of debt and create a financial reserve.
Step 3 – Adjust your income to your reality
Third, know your financial reality. In this regard, it is important to create a spreadsheet.
Enter all the values relating to your cost of living, debts and your monthly income.
This way, you can adjust your spending according to your income and consume consciously according to your planning and established goals.
Step 4 – Record your expenses
Make a habit of writing down all your expenses and always have the appropriate notes in view.
Practicing this habit helps to increase clarity about where your money is going and to know whether a particular purchase was really necessary or not.
Step 5 – Include your family in your new lifestyle
After knowing your goals and new lifestyle, the final and most important step is to include your family in the new habit.
Gather family members together and inform them about the financial mismanagement, so that everyone is involved in the situation. Adopt practices to reduce unnecessary consumption.
Can I have a credit card in this scenario?
The credit card is a necessary tool nowadays, both for payments in physical and virtual establishments.
Certainly, if you are in a situation of excessive debt, your credit score must be down there.
The occasion, in fact, prevents access to several lines of credit, including the card.
So, the best thing to do is to have a prepaid credit card in your wallet.
This way, you can make your payments easier and also have more control over your finances.
After all, all expenses are recorded and it is even possible to set a certain prepaid limit for you and your family to use.
This without any weight on your conscience, accumulation of debts or loss of control.
Conclusion
According to all the situations presented in the text, we finally discovered the causes of the lack of financial control and what actions are necessary to minimize the damage.
Knowing what really affects our finances is an extremely important act. This way, we can establish action plans to change destructive habits.
Having clear and defined financial goals is essential to getting out of the red and entering a state of abundance.
This way, you can spend less than your salary and save a good portion of your money.
In addition to balancing debts and avoiding new bills due to impulse or some emotional situation.
Without a shadow of a doubt, the recommended financial product at this time is the prepaid credit card.
Our recommendation is the Din prepaid credit card from Banco Bradesco. In addition to having control over your daily expenses, you also have access to 50% discounts at Cinemark cinemas.
Cool, right? You can join now at no cost.⤵️⤵️⤵️
