Have Confidence in Your Financial Decisions
We all know how important it is to have a strong financial plan, financial goals. What is it they say? If you fail to plan then you plan to fail. At times though it can be easy to allow what other people are saying and doing to interfere with our own personal financial plan. This can cause big problems for you in the long run because as with all things, everybody has a different opinion on how you should be managing your money. Let’s consider just one area where you may allow others to steer you away from your financial plan, only to regret it in the future.
Buying a House
As we have discussed many times on Money Bulldog, buying a house is an admirable financial goal to have. What though, if having done all the figures, you have decided that you can’t quite afford it right now or perhaps you don’t believe the hype that house prices are due to sky rocket? Will you stick to your own financial plan or will you – over time – allow yourself to be worn down by those around you? Pressure can come in many forms. It may be a well-meaning parent or grandparent harping on about renting being dead money, it may come from the media as the so called professionals express their confidence in the housing market, or it may come from within as you start to feel that you are being in some way left behind. Thinking about the scenarios mentioned above there are a few things that we need to remember.
Well-meaning family members
As well-meaning as family members may be in their determination to see you progress onto the housing ladder, more often than not they do not know your complete financial situation. If you truly feel that you can’t afford a house right now – or if you feel that you may not be able to afford a mortgage if rates were to rise in the short to medium term – then don’t do it. Have confidence in your financial plan. Not only will you save yourself years of worry trying to pay for a mortgage that you can’t afford, you might also find that houses are more affordable when you do eventually come to buy in future. Everybody has to make their own decision on such a huge financial purchase, so do your sums and have confidence in that decision. Even if the market does go against you and you end up paying a little more in future, in my opinion it’s better to live with the regret of a decision you have made than to spend half of your life blaming others for pushing you down a road that you were just not ready for.
In our technological age it is fairly easy to be bombarded and influenced by the media. At the moment all we seem to hear about is how the economy is recovering at a startling pace and how house prices are rising and are set to rise further. The problem with the media is that they just love overplaying and sensationalising a certain angle. In times of crisis they will often over play a situation and the same goes in times of a supposed boom. At present in the UK we have been hearing a lot about the growth of house prices and this could easily cause you to panic and forget your own, well thought out financial plan. If you dig a little deeper into the media you will also find many experts writing about their worry of a possible housing bubble occurring. Even the governor of the Bank of England – the man who has more influence than anyone over the direction of house prices – has again warned on the housing market. So don’t let the media scare you into making the biggest purchase of your life. If you do decide to buy a house let it be because you have done your figures and research and you feel the time is right for you, don’t let it be because the media scared you into it.
Pressure from within
We all want to feel as though we are progressing in life and because of this we can easily become impatient or unhappy with our lot. When it comes to our finances though, impatience and dissatisfaction are powerful enemies and many have found themselves crippled by debt because of them.
Have you ever felt pressured into a financial decision or purchase, only to regret it later?