With the weakening economy, people find they need to pay closer attention to their personal finances. As they begin to tackle their finances to get them in order, they usually come across some truths that they really don't want to accept. The main reason is that these truths mean that the each person must take more responsibility and make hard decisions that they would rather leave to others.By understanding these inconvenient truths, you place yourself in a position to better deal with your money in a positive way. Here are a few of the most common of those awful truths.
6. You can't have everything you want.Whine, complain and throw as many tantrums as you want, but the words of your parents when you were a kid still apply now that you're an adult. Even though every commercial you see will tell you that you can have everything you want, the hard truth is that you can't. In order to stay out of debt, make sure your finances are healthy and reach your financial goals , you will need to make difficult choices about where it's best to spend your money. That means giving up some things you may want. If you don't, you'll end up with maxed-out credit cards and years of slavery to your debt. It may not make you happy, but the sooner you realize this truth, the better off your finances will be so that you don't end up working while all your friends are retired. This will also help you prioritize your spending on what is really important to you.
5. Financial institutions are not your friends.Banks, credit card companies and even investment firms are there for only one purpose: to make money off of you. No matter how much they tell you that they have your best interests at heart, they are not your friends and they will charge you with any fee that they think they can get away with. It's common for banks to add "courtesy overdraft protection" to your banking accounts, which can cost you hundreds of dollars and fixed-rate credit cards are only fixed until the credit card issuer decides they want to change the interest rate. (Don't miss " 10 Banking Moves You Should Make Today") You must always look out for your own interests and make sure that these financial companies are not trying to nickel and dime you., because they have no problem changing the rules in the middle of the game -- especially if they feel they are not getting enough of your money. So next time you listen to their pitches, remember that their primary purpose is their bottom line and not yours. Use their financial services if it is advantageous to you, but never become complacent or you will find a lot of your hard-earned money flowing to their pockets.
4. Nobody is going to teach you personal finance.In a perfect world, parents or schools would make teaching personal finance knowledge as important as basic reading, writing and arithmetic. Unfortunately, for the vast majority of people, you are entirely on your own to learn personal finance basics. Your parents probably didn't teach you because they were clueless and learning themselves as you were growing up and the school system has done little to address the issue. That means you're going to have to make a concerted effort to actually learn how to get your personal finances in order yourself. Go to the library and check-out one of the many excellent books (such as Smart and Simple Finances for Busy People by Jane Bryant Quinn, The Total Money Makeover by Dave Ramsey or The Wealthy Barber by David Chilton) that teach the basics about personal finance and begin reading. If you don't, you're going to learn by trial and error, which is going to hurt your finances a lot more than taking the initiative and learning how to take care of them right now. The longer you delay learning this truth, the worse off your finances will be.
3. You are your own worst enemy.When it comes to personal finances, the state that you find yourself in can't be blamed on outside forces. If you're in terrible debt or your finances simply are not where you wan them to be , walk to the mirror and take a good, long, hard look. The person that's responsible for all the personal finance problems is staring right back at you. With few exceptions, you have only yourself to blame. So accept what you have done, take responsibility for your previous actions and take the steps needed to make the changes to get your personal finances back into order. These steps include figuring out how to create a budget that works with your current income and identifying where you need to cut spending and ways that you can save more. Trying to blame others for your situation will only mean that you will not take the needed steps to actually improve your finances and it only prolong the debt you find yourself with.