10 common financial mistakes that people make in Russia

Life without mistakes may seem a boring, but life without financial errors, in contrast, brings confidence, stability and joy the achievement of intended goals. What the most common mistakes you should avoid to your financial life was carefree?

1. The lack of a "safety cushion"

The vast majority of people believed that any accumulation of absolutely nothing: still all lose, so why hoard, if you can all spend now and buy a right thing?

Perhaps, at a specific moment of life this decision may seem and faithful, but after some time you may need some amount for unforeseen expenses: small repairs in the apartment, or medicine, or payment of rent increase or delay salary. …

How to pay these expenses if no savings? Credit may not issue, and it often takes a few days or even weeks, and you may or may not be this time. That is why it is important to remember about the first rule: always be hoarding at a rate of 3-6 monthly cost contingency.

2. The accumulation of "under the mattress" instead of the Bank

In Russia less than 50 per cent of the population have bank deposits and up to 5%-are investors in the stock market. And all because a few people trusted by some financial instruments, preferring to keep stockpiling at home under his pillow/mattresses/bedside table etc.

Actually, this kind of "investment" gives a guaranteed income minus 10-13% Apr! The reason is simple: inflation. So, your today's 500 thousand. rub on a bedside table, through 5 years become already in 310 thousand. rub. when inflation 10% per year. So the second rule: don't store the accumulation in the nightstand-better their place, at least on a bank deposit to save from inflation. Are you afraid of bankruptcy? Teach that when placed in the same bank to 700 thousand. rub. when denying him a license, you are guaranteed to return your contribution to the safe and sound thanks to the system of deposit insurance.

3. Wrong loan options

When choosing a loan, it is important to remember that it should: be in the currency in which you receive your salary. It is often the ruble. If the temptation to take out a loan in foreign currency at a lower rate, you can then get the growth of your monthly loan payments at 30-50% due to the fall of the ruble exchange rate.

Be not too large: grab your credit is not "conservative" just in case, namely the amount you need. Please note that extra 50 thousand. rub. loan, you will need to return the Bank already 75 thousand. and more. Be not too long: take credit for the term to payment on the loan was feasible for you, but not too low. Please note that credit in 200 thousand. rub., spanning 5 years instead of 2-x, will result in the need to pay an extra 110 thousand. rub. Therefore it is better to take loan bank in rubles, the desired amount and for a minimum period to loan payment amounted to 20-30% of your income.

4. The pursuit of profitability

Risk-free yield is higher than the percentage on deposit does not exist. Therefore, income above 12-17% in rubles and 5-9% in currency guaranteed to be linked to the risk of losing all or part of your savings. So, after seeing an ad about a guaranteed yield higher percentage on deposit, the better to bypass the company party, because with a very high probability it will be financial pyramid.

5. Investment without time limit

It is impossible to correctly invest unless you know for what specific purpose. "Make" is not a goal. The goal should be the deadline, cost and priority. Only by clearly defining it can competently pick up suitable investment tools.

So, if you invest to build on some important purpose (such as an apartment) via 1-3 of the year, it is best to prefer bank deposits and high-quality bonds or bond funds. If we are talking about goals through 3-10 years, apart from deposits and bonds, you can add to your portfolio up to 50% of the shares or equity funds. Well, if you invest in 10 years or more, you can increase the share up to 70-80%.

6. Underestimation of their responses to the risk of

If your colleague or neighbor invests in equities and rejoices yields 20% and higher, this does not mean that you need to buy them. The fact of the matter is that each person-your level of addiction to risk. And if your neighbor is sometimes willing to endure the fall in the value of its shares to 50%, then you may be ready to sell shares just at the most inopportune time, get the losses and be disappointed in investments.

Therefore, it is very important to correctly determine your propensity to risk: If you're not ready for significant drops the value of your investment, put a large portion of funds on deposits and strong bonds. If you're ready to severe fluctuations in size of your savings-you can put a bit of it in stocks.

7. Neglect of insurance

Apartment insurance in Russia, machines and the more unpopular, because life the majority believes that with them exactly nothing can happen. Life in General is insured by less than 2% of the population, although one of the most common causes of delay and non-payment on loans are just incidental expenses for medical treatment.

Such expenses for the repair of apartments, on compensation for flooded neighbours from below, to restore their health in the majority of cases, unexpected and require significant expenses to which not all ready. Therefore, property insurance, liability and life is the key to confidence in everyone.

8. Start savings for retirement for a couple of years until it

Pension financial purpose seldom meets anyone, most people don't even think about it, setting aside "for the future". In the meantime, if you want to have retired in 40 thousand. rub., you need to at least postpone the monthly bank deposit not less than 25 thousand. rub. for 10 years! If you remember about a pension for 3 years prior to her, for pensions in the 40th. rub. you will be within 3 years delay in deposit by 130 thousand. rub. in months. Therefore, the pension you need to think at least 10 years before.

9. Disregard the tax benefits

Not many people know and use all kinds of tax deductions. In the meantime, anyone can get into the account each year to 15 600 rub., if he paid for training, treatment, invested in your pension or was engaged in charity.

If you were buying an apartment or a House, you can get to the account up to 260 thousand. rub. plus additional compensation for interest on the loan for purchase of real estate. So, when a mortgage in the amount of 5 million. rub. for 15 years, 12% use tax deductions on interest would return 13% of all paid interest on the loan is more than 750 thousand. rub.

10. Lack of personal financial plan

Personal financial plan is a rarity in principle. But his absence could lead to serious consequences. For example, if a man only thinks about buying a car in a year, and the purchase of apartments over 3 years and pay for his son's education through the 10 years he does not plan to, it may well be that he has gained the required amount on the car, but the increased cost of transport does not allow him to accumulate the amount of the initial payment on the mortgage.

As a result, he buys an apartment without a down payment, and a smaller area than we would like, because the more he didn't have enough opportunities. Because of the large credit payments he will not be able to accumulate the sum of tuition of the son, and he will not come in the best UNIVERSITY to get on free.

If at this point education will be fully paid, the son is just not what it is getting. About retirement the issue in person and say no. And all this unfavorable scenario occurred only because the man had before only one goal, but not a complete financial plan, taking into account the objectives until retirement.

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Автор статьи: Максим Миллер - о авторе.
Бизнесмен, инвестор, финансовый консультант Facebook
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