How do you end up in financial distress? There are many reasons, and, when it comes to facing a potential bankruptcy, very often the biggest triggering event is a medical crisis or a divorce. But there are smaller factors that can add up to your finding yourself in a big crisis. This is the eleventh in a series on what one bankruptcy attorney identifies as the “Top Ten Personal Financial Mistakes” people make. His list is useful for all of us to review and consider, and his posts link to helpful resources available on the web. Be sure to click on the link below to his post and check out the resources he provides, too.
Here’s an excerpt from the series by Eugene S. Melchionne, Connecticut Bankruptcy Attorney at www.bankruptcylawnetwork.com.
Emotion leads to irrational decisions and it is never good to let emotion rule when it comes to finance. Some people use spending to cheer up and avoid feeling depressed. Emotional spending will crash you budget. But saving money will be the long term road to financial independence and ultimately, happiness and freedom from worry. After that, all you need is health.
Alan Greenspan used the term “irrational exuberance” to describe the stock market of the late 1990’s.
Again, Gene wrote this before the September/early October governmental actions. Many of us are trying to be more mindful about how and where we spend our money (and we are grateful that we have money to spend). These are very frightening times for many, economically. Read Gene’s post and go back to Parts 1 and 2 of this series, to review about setting goals and being minddful.
More on Borrowing From Credit Card Companies, Having No Emergency Fund, Failing to Save for Long-Term Needs, Failing to Accept Free Money, Miscalculating Life-Insurance Needs, Putting Your Eggs In One Basket