We all make financial mistakes in our lives normally. Many investment options or savings seem right at a certain point but then turn out to be bad decisions. Or not we save what we thought, or don’t win much with our investment as we thought or even worse, lose some money.
This occurs in all aspects of our lives: our career, our personal lives and any other area where decisions are made and we have to live with the consequences.
Many times, financially, this happens for wanting to save more and ultimately end up spending a lot because we are too ambitious and make investments very risky and wildly.
Then we will see a number of steps can take to identify the error, take lessons from those mistakes and apply them to our own life.
Assume that we have made a mistake
The first step to using a bug to improve is to realize that we made a mistake. Often, it is not clear whether we’ve made a mistake, we might believe that our plan is well designed and that the bad result comes from things outside our control.
Mostly this happens often with investments, purchases shares of a company and suddenly instead of raising its price down or it was purchased by its dividend and it turns out that the downgrade, it is very typical to blame the market, speculators instead of ourselves.
Whenever we get a bad result the first thing is to find the culprit in ourself. There is almost always some aspect of our election processes that has gone wrong, somewhere that we could have done differently or prepares it in another way.
Find what has been the key to the wrong decision
Sometimes we have a bad result and are completely unable to see how it could be our fault. It’s easy to fall into the trap of always blaming external sources rather than ourselves.
It is especially easy to do this when the mistake we made is not obvious to the naked eye. Spend time to search through all our assumptions to find out what was wrong. Finally, we will find where the mistake that we made is.
Identify the reasons why we made that wrong decision
Once we’ve found the wrong choice that we made, it’s easy to say that with not doing so next time already everything is solved. However, it is still the easiest way.
Why did we take this decision? What were our reasons for making that choice? It is very likely that our error was just a consequence of a larger defect should investigate in detail.
Build a plan to address these shortcomings
Once we have discovered the merits of what are going to do about it? We’ve done the legwork to find some aspect of ourself that needs improvement, so it is necessary to setup a plan to work that way.
If we’re trying to overcome a mistake and make a profit on it, it is useful for us to develop a daily plan to address that error and look for ways to avoid it. Is there anything we can do or practice every day that just take us to a different path?
In this way for a simple way and faster than we think, we’ll be eliminating our harmful financial habits modifying them with better ones.
Share this plan with others
Before implementing the plan, speaks of it with some people who are close to us, like family and friends, who are willing to offer honest advice. It’s easy to be too radical with the solution or even that is not sufficient and will not see so for ourself, being necessary to let us notice another person that we trust.
Discuss each step of the plan and the logic for each step that we establish and ask their opinion. Listen and note what they say, modifying the plan based on what we discuss.
If we have someone in our life that we fully trust his judgment, talk to that person. Share mistakes and work with it to make sure we will never commit another failure.