The present world is vastly different than in past times. From our living styles to our spending sprees, everything has changed. Some think the changes are for the better and then there the opponents who tend to believe otherwise.
What is your take on it? I feel that in terms of technology, we have certainly made a lot of improvements; however, the financial aspect has taken a bit of a hit. The frequency of economic failures that we see today is far higher than it was in previous centuries.
One day a person is a multi-millionaire, and the next day he is looking into loans for bad credit with no guarantor. There is something innately wrong with the way we look at our finances and the way we manage them.
Acquiring wealth is easy enough, but maintaining it can be a bit of a problem. Here are three of the most common reasons as to why people have to face financial setbacks.
GAP BETWEEN APPRAISALS AND INFLATION
Every year, commodities become more expensive than they were last year. This phenomenon is called inflation. It is a recurring concept that is inescapable. But think about it, if the commodities are becoming costlier than someone is profiting off of it. A businessman probably; he would earn more income, and consequently, his employees would be paid a higher salary.
Up until this point, everything works perfectly. The problem arises when the inflation rate is higher than the appraisal rate.
Let us understand this, assuming your salary is X in 2020, and your appraisal rate is 5% yearly. The percentage of inflation is 10%. So in the first few years, you would be able to manage your expenses and income. After that, the costs will be more than your income and your financial situation will go into a downward spiral leading to failure.
THE CHASE OF BEING THE BEST
The millennials are people who believe in being extravagant and showing off. This ideology has resulted in many to lose all of their fortunes. The perpetual competition of being the best, and possessing everything that is latest in the market to make your social circle wreath in jealously, is against every principle of financial management.
- If someone has a bought an iPhone 11, the iPhone 11 max pro will most definitely be the next purchase of the envious neighbour.
- If someone has appointed an interior designer, it can be expected that someone else will hire an architect to do the entirely un-necessitated renovations.
- If someone has hosted a small get-together, expect a lavish party in the next week with valet parking and champagne fountains.
People do not realise that they do not impress anyone, the next gadget, the next big house and party will make everyone forget theirs. The only thing they are accomplishing is draining their hard-earned money.
The next problem is not as related to financial management as it is to the health standards. No doubt, the 21st century has seen immense advancements in the medical sciences and life expectancy of people, but it has also witnessed ailments that were unheard in the past.
- Cancer has become a household name with patients that are 6-year-old children and 60-year-old men.
- Nobody gets shocked when they hear that someone has had a stroke or is diabetic.
- Stress, anxiety and depression areas every day as happiness and joy were in the past, being in abundance.
- People cannot climb a flight of stairs without being on the verge of hyperventilating.
All of these have not only reduced the work efficiency of the people, but also their will and zeal. There is hardly anyone left in the world who does not visit the emergency room at least twice in a year. Some even make monthly doctor visits.
If people are not healthy, both mentally and physically, they will never be able to earn, and consequently, their financial situation will be nothing but a disaster.
In the end, I want to ask you a question. Do you think that if we can overcome these three mishaps in our financial management, there would be a market for very bad credit loans with no guarantor and no broker in the UK? I do not think so.
If we start focusing on managing our finances today by budgeting and saving, concepts like lousy credit will become a thing of the past. However, we have to start today. Financial failure may be shared today. We cannot let it be prevalent in the future as well.