Getting your finances in order isn’t fun, it’s not something you get excited over usually, most of us don’t leave work and think “Woohoo! Let’s hurry home so I can sort my bank transactions and review my budget!”

But just by being aware of some of these very common mistakes that so many of us make without even thinking about it, you might just find that things start to come together for you all on their own.

1: Ignore your successful friends

Somewhere in your circle of friends, relatives, coworkers, or community you probably know someone who is financially successful. 9 times out of 10, if you asked them for some insights into how they manage their finances or investments they would be happy to give you some advice. And it would generally be good advice, after all, they have a proven track record of it working.

Have you done this? Or instead, have you been brainstorming ways to get rich with your friends who are just as little savings as you do?

Although this can be great for venting, it rarely leads to any real change, as if they knew what it took to succeed financially they probably would have done it themselves by now!

2: Don’t plan for unexpected or yearly bills

You might have a budget, might even have gone as far as to have an automatic transfer of a portion of your wage to a seperate savings account, and this should be getting you well on your way to reaching your financial goals. Except for when things like car registration, Christmas gifts, birthday gifts, home repairs, rates etc. pop up unexpectedly because they were either impossible to predict, or because they weren’t part of your budget calculations.

You find yourself dipping into your savings to cover these expenses, and at the end of the year, after all your hard work, you have barely anything to show for it.

Instead, having a $500-1000 buffer of savings for unexpected expenses that is seperate from your general savings account can help deal with life little mishaps, and ensuring that recurring quarterly, half yearly, or yearly expenses are considered in your overall budget. For example, a $600 car registration bill is an extra $11.55 a week to include in your budget.

3: Don’t have a timeline

If your plan is to buy an investment property, but you don’t have a set amount of savings that is required, and a set date to achieve this by, you won’t have any idea just how much you can spend or need to save each week.

Can you afford a $100 birthday present or doesn’t is need to be a $20 bottle of wine instead? If you’ve gone over budget do you need to put in extra hours at work to make up for it? Know what it is you want, why you want it, and how to get it.

4: Working for your money instead of making your money work for you

If putting in more hours is the only way you can see to earn more, you are stuck in the “work for your money” mindset. You might be able to get together some savings, but at the end of the day the costs of living are rising, and will this be enough to cover expenses if you retire at 65 and live until you are 90?

Plus… is working long hours week in week out really how you want to spend your life?

Instead of investments being a nice to have option, or something only wealthy people do, it has instead almost become a necessity. The point of saving your money now is not to have it sit there in a bank account doing nothing until you retire.

The point of having savings is to use them as a tool so that you generate income without having to lift a finger. This is the “making your money work for you” mentality. You invest your money, this grows in value, your money earns you more money, which you can then use to purchase additional investments, and so on and so forth.

At some point, your investments have paid themselves off and are generating profit with very little outlay in capital. You can retire, maybe even years earlier than you expected, with an ongoing income stream (or multiple income streams) coming through to you. Instead of watching your bank account dwindle over time, you can enjoy having a healthy amount of disposable income and still be financially successful.

If you have gotten to the point where you have reached your savings goal and are ready top move forward with acquiring your next investment, look into making that purchase a dual occupancy home from Dual Key Homes. There’s a great article here about the reasons why this strategy gets you two rental income streams from the one property, instead of having to wait years until you are in a position to buy a second property.