Making mistakes is common. However, mistakes related to managing money are best avoided because they have a direct impact on daily life as well as the future.
How have you managed your finances so far? It turns out that there are 3 common mistakes in financial management that anyone can make. Are you one of them?
Let’s find out the mistakes to avoid them. And, if you have already made those mistakes, you can change direction immediately for peace of mind and a secure future.
How to Manage Money: Top 3 Mistakes to Avoid
1. There is no clear financial plan
Good financial management starts with budgeting, for both expenses and savings. Knowing exactly where the money goes enables you to make a clear and mature financial plan.
Without proper budgeting, you can spend excessively because you have no way of knowing how much money you are spending.
Then what’s the solution? There is a practical and innovative solution that you can enjoy in the Jago application. Using the Pocket feature, you can actively separate your needs or expenses from the start. There are many kinds of needs, for example, shopping, movie streaming subscriptions and children’s school fees.
So you don’t get confused and can track everything easily, you can separate your needs into different Pockets. Don’t forget to set a budget for each Pocket, so that it’s clear how much money is being spent on needs. It can be done directly in the Jago application, so you don’t need to have a notebook anymore for manual notes and tracking.
2. Delay, and finally forget, paying bills and installments
Many people choose to postpone paying bills and installments because they prioritize other needs and have to go to the ATM. Pay bills and installments later, no problem, they say.
Then when the time to pay comes, it turns out that the money had been used up. In this situation, you will face a problem because you can’t pay bills and installments. Not to mention, you are subject to a fine due to late payment.
You can start adapting the habit of paying bills and installments on time with Jago’s Plan Ahead feature. You can schedule payments for all bills and installments in advance. This way, you will not forget to complete your obligations. Because it is scheduled, bills or installments can be paid automatically by Jago. No need to go to an ATM.
3. Ignoring the importance of an emergency fund
Many people think an emergency will not happen to them. Or, even if they experience it, they’ll figure out what to do when it does happen. Why worry about something that isn’t real, which isn’t necessarily happening? It is better to use the money for current needs.
Not having an emergency fund at all is the wrong way to manage finances. Why? Emergency events are not something that can be predicted. If an emergency happens and you don’t have funds, you are likely to borrow money.
If you borrow money and you can’t pay it later, you will end up in debt. To avoid this unpleasant situation, taking precautions would be the ideal solution.
Saving for an emergency fund doesn’t have to be a burden if you are doing it with Jago. You can start small. The important thing is that you always set aside money for emergency fund savings.
You can name the Pocket Emergency Fund Savings (or whatever you want), and you lock it so that it’s only used when it’s urgent. When a Saving Pocket is locked, it becomes a Locked Pocket.
You can put money into your Pocket, starting from Rp 100thousand, to be locked according to the duration of your choice, starting from 14 days.
When you have more money, you can immediately add it to the Locked Pocket. In addition to locking money so that it is not used up, the Locked Pocket offers competitive interest. So, you will have extra money when the Pocket is unlocked.
To make it easier, you can follow these steps:
- On your Pockets tab, tap the Create Pocket button.
- Choose to create a Savings Pocket.
- Give your Pocket a name, and set the background color and picture.
- Open the dropdown for Add Boosters and choose Lock Pocket.
- Here, you can set up the commitment amount and tenor. You can also visualize the gained interest on the displayed chart.
- Review your lock details. Make sure everything is correct, then tap Lock Pocket.
Making money work for you does take time and of course, positive money management practices. So, make sure you don’t make the three mistakes above.
