Friday, 20 November 2015

Top 5 Common Habits Which Are Obstacles To Your Financial Planning

Posted by MyInvestmentsPub
Every one dreams to earn quick money and to become financially strong with in short span of time. These are the common wishes to all of us. However, most of us having some habits which in turn causes main obstacles for your Financial Planning. However to make your dreams true, you should overcome these habits and should follow some disciplined approaches. When we know all these things, then only we will reach financially to a stable position. We will see what are these common habits that will become obstacles to our financial planning in this article.

Common Habits which are Obstacles to Your Financial Planning:

1. Purchasing Habits: 

All companies are coming with innovative installment programs to sell out their products. Various attractive discount schemes and easy installment offers luring the customers and purchasing household items on installments. These kind of purchasing habits some times causing negative impact on your monthly budget. The total EMIs may cross your monthly earnings. If you are
purchasing items on installment basis, it will result in empty pockets at the end of every month. You should overcome this kind of Purchasing habit at the earliest.

How to overcome this Purchasing Habit:

Segregate and Prioritize all your needs on monthly basis. If your total expenses are more than your earnings, then you should properly plan your budget and remove or defer the lowest priority needs from the list. You can also look for the opportunities to increase your revenue.

2. Comparison Habits:

This is one of the worst habit that makes you financial instability in short span of time. We used to compare with our neighbors on various aspects. For example, your neighbor having a luxury sedan car where as you are having a basic hatchback model. It will tempt you to sell out your old car and to purchase the newest sedan or SUV model. This habit may create a temporary feeling of self-satisfaction but cause a severe debt on your personal budget.

How to overcome this Comparison Habit:

You should remember there are good loans and bad loans. Home loans and Student loans are good loans and can be compared with others. However, bad loans like car loans, personal loans, credit card loans etc will cause you a deeper dent on your purse.

3. Postponement Habits:

Many of us having a bad habit of postponing the works. For example, we will think that we will take a resolution of starting an Investment from coming New year. However, very few of us will stick to that resolution and will start the investment from the new year day. Like wise, we may postpone taking a Term policy, Health Insurance policy, Buying a Home etc. These postponements result a huge lost on your savings and also some times may cause a huge loss which cannot be replaced.

How to overcome this Postponement Habit:

Emergency situation may turn up at any point of time. You should be well prepared to face this situation. You should not postpone certain things like starting a SIP, Taking Term policy at early stage, Taking Health Insurance for all your family. If you are postponing these kind of things will make you difficult to reach your financial goals.

4. Fear to Risk Habits:

Some people unnecessary fear to take risk on choosing the right investments for their various financial goals. You should remember that every Investment will have some risk factor. Based on the Investment product, this factor may vary. However, it is not at all good idea putting all your investments into safety investment products. These safety products may not yield good returns and may not achieve inflation-beat returns. I agree equity investments are risky however over a long period of time, the returns from the equities are far better than the traditional safety investments. You should select the risk factor based on your financial goals.

How to overcome this Fear to Risk Habit:

High risk yields high returns. You can take some risk for all your long-term goals. Mutual funds are always suggestible product to your various financial goals. Choosing the right mutual fund depends on your financial goal.

5. Act-in-Last-Minute Habit:

Some people will not act until they reach the due date. They act in the last minute and create unnecessary penalties or expenses. For example, if you delay 1 day to the due-date in paying your vehicle insurance may result in loosing NCB (No Claim Bonus). If you delay 1 hour to the due-date in paying your credit card bill would result in hefty interest rates on your out-standings.  

How to overcome this Act-In-Last-Minute Habit:

Try to automate the paying of all your utility bills from your Savings bank account or Credit card directly with in the due-date. Even if you forget paying the utility bill, this automation would take care. However, you need to maintain sufficient funds on your savings account.


There are many other habits like frequent outing and eating, habits like smoking and drinking, Trading investments with out knowledge etc are some of the habits that make obstacles to your financial planning and cause a severe dent to your budget. A systematic investment approach with long term perspective would definitely yield good results and create smooth financial journey. 


  1. Nice Article Ravikumar. Act in the last minute, we may need to pay higher price

  2. Thank you Suresh for your comment on my blog.

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