Mistake 1: Not valuing your time and treating it like it’s for free
We don’t know how much is our per hour cost. We don’t know how much do we actually spend watching Netflix. We don’t know how much should we charge for a project.
We don’t understand how our time = money
Mistake 2: Spending your time on things that are easy to measure money-wise
We will spend half a day travelling to one end of the city just to save Rs 1,000, because we know we will conclusively save that amount. But we won’t spend two hours preparing for our salary negotiation.
Mistake 3: Taking too many loans
We over-index on our future earnings and spend more than we can afford today. Loans tie us down. They increase our burn rate. They make us risk-averse. They make us feel like we are stuck.
Mistake 4: Believing that our income is capped
Our income is not capped. There is no upper limit to how much we can earn. Instead, it is our spending that is capped. We have to spend a bare minimum to live, to survive. Instead of reducing your expenses, focus on increasing your income.
Mistake 5: Trying to time the market
The market is too high, let it fall. The market is low. No one knows the highs or lows of a market. The best way to invest over a long term is to invest regularly, irrespective of the price at that time.
Mistake 6: Investing because of FOMO
Everyone is investing in Bitcoin, I should too. Everyone is selling Bitcoin, I should too. Everyone is buying ITC, I should too. Everyone is selling ITC, I should too.
Everyone is not you! Invest on your beliefs, research and appetite.
Mistake 7: Renting your time and not owning any assets
Everyone in a job isn’t going to create supernormal wealth. This is because we have to spend time working, to earn. Assets, on the other hand, make money, even when we are sleeping. Start a company. Own stocks. Create rental income.
Mistake 8: Investing late
My 20s is the time to have fun. I will start investing in the 30s. My 30s is the time to build a family and enjoy. I will start investing in my 40s. The right time to start investing was when you turned 18. The next best time is today.
Mistake 9: Comparing your money to others
Money, for most of us, is an outcome, not an input. It is the result of the decisions we have made, not the reason for the decisions we made. Compare the decisions people made to get to their money. Comparing the outcome won’t help.
Mistake 10: Running after money
Money gives you freedom, and freedom is a privilege. But the minute we run after money, we are not free anymore. Use money to earn your freedom. Don’t give up your freedom to earn money.