Top personal financial planning mistakes 5 – Loans and debts

This is a part on the debt and loans and how that affect badly to one’s personal financial plan. As I said in the part 4, some people earning very handsome amount but, not having sufficient amount to invest. Lots of bad debts and loans are the major cause behind this behavior.

Borrow the quote from Sarah Beeny on debt “Don’t stretch yourself too much with a mortgage. Buy within your means.. it’s not worth the sleepless nights”Creating and sticking on a budget help you to control over unnecessary and unwanted expenses.Bad debt is always against a perfect financial plan. A person with huge debt is always in poverty. It is very difficult to get out from the grip of debtors. Especially, if you have married with credit cards and having habits of taking personal loans. Both can trap you with its huge interest rates that you required to pay back to the creditor.As a first step to create a good financial plan, you are required to reduce your loans or pay off all the debts as early as possible. Credit cards are a major source to lose enormous amount. One should have proper grip on the same. Proper use of credit card and paying off all the huge interested personal loans are a must.

This is Part 5 in a series on Top personal financial planning mistakes. The full series is Part 1, Part 2, Part 3, Part 4, Part 5 and Part 6