My Biggest Money Mistakes
I’m proud to say that I made only a few money mistakes ever since I started earning. It was my mother who made all the money mistakes in our family, and I mostly learned what not to do by just watching her. She hasn’t saved enough for her retirement, she incurred so much debt that it’s impossible to repay, and she lived beyond her means even when she had no job. Her mistakes were a financial nightmare for the entire family.
I guess you could say that I became smart with money because I was so afraid of ending up like her. This fear made me educate myself about saving and earning so that I would not have to repeat her mistakes and make my children pay for them.
But this doesn’t mean that I’m free from mistakes. I am perfectly human. I’ve made some money and business mistakes that I wish I never made. Here they are:
Lending money to others. Sometimes, even when it comes to relatives, lending money actually means giving it without expecting anything in return. For years I said “yes” to lending money to family members, and I rarely saw a centavo of my money back. This led to tense family relations, which weren’t worth the money I “gave away”.
The bottom line? Involving money in your family relationships tends to be messy and destructive. Learning from my mistake, I’ll be avoiding this situation again.
Doing everything myself. When I started my online business, I did everything myself. It’s perfectly normal to start a business as a one-woman show. The problem was that it stayed that way for 3 years.
One of the most important things about running a business is that you should work on it, not in it. I got this idea from a book called The E-Myth Revisited. You should get others to work with you, whether it’s a business partner, a contractor, or in-house employees. This allows you to focus on the more important aspects of the business as well as the tasks you enjoy.
What does this have to do with money? Well, if you do everything yourself, your time will be consumed by tasks that anyone else can do. You won’t have the time or energy to do other tasks that will bring in more money such as expanding your business, doing guerrilla marketing, and creating other means to diversify your income.
Undercharging for my services. I used to be afraid to charge higher for my writing services, thinking that clients would hire some $1 writer from other countries. I used to charge $5 to $20/article. It took a very generous client before I realized that I could charge much more than that. Now I get paid around $30 to $100 for most of my work. This means that I get paid more per hour and can actually relax about work a bit, rather than spending every single waking moment writing articles. I may love my work, but there are other things I want to do as well.
Also, getting paid more made me become more serious about improving the quality of my work. I guess both my clients and I won in the end 
Not applying the 80/20 principle. One of my biggest business mistakes was giving all my clients and projects equal time and effort. Why is this a mistake? Because some ventures, clients, and projects will be worth more than others. What should you spend more time on, the difficult and demanding client who pays you at a low rate, or the low-maintenance client who pays well? It took me a few years to learn to focus on the latter.
This is where the 80/20 principle comes in. A short definition of this principle is that 80% of your output/income, should come from 20% of your input/effort. Of course, you don’t follow this idea literally, counting every percentage. The point is that you should focus on the things that give you the best results with the smallest amount of effort.
These are only the top 4 mistakes I can remember off the top of my head. How about you? What financial mistakes have you made in the past? What could you have done to avoid them?
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