Saving and investment can be sweet when you start to get returns. However, the same can be sour when you make costly mistakes that washes away your investment.  And all of us are prone to mistakes which sometimes can be very expensive and painful.

As we have been encouraging you to save and invest, it is equally important that we alert you of some pretty common mistakes so you can avoid them.

 1 Ignoring investment and being a consumerist

Many people earn good money at the end of the month or a day. Sadly, they have developed a very dangerous philosophy of “enjoy now and suffer later.” They end up having a mini supermarket of things they do not need in their homes.

Recommended article: Saving and Investment: Valuable lessons from Asians

This thinking is partly the reason why Africa has a large number of working poor class.

Of all of the mistakes you might make as a company or a working professional, is to fail to plan for uncertain times ahead.  Employment is temporary, and if you are a business owner, that enterprise could encounter serious challenges. Retirement is one of the most expensive periods in one’s life because monthly salary reduces to a stipend while responsibilities may still be high. In order not to become a burden on your children or other relatives, start investing now.

    2 Investing in an unfamiliar venture

One of the most common mistakes people make is pooling their resources and investing them in a venture they know very little or nothing about. Many who have lived and worked in the city all their lives quickly jump into agriculture as their first investment option. Unless you are relying on an expert in that field, this is the number one mistake you should avoid.

Having prior knowledge about an investment venture will enable you avoid errors in areas such as input and output pricing, quality control and market viability. It also helps you to have a clear picture of possible returns on investment.

Importantly, in case you are opting for the services of brokers and other experts in your chosen field of investment, be sure to compare service fees in order to make an informed decision.

All of these players have different fees. Educate yourself on their various seemingly juicy offfers.

3   Failure to diversify and being impatient

Whether a company or an individual, it is crucial that you diversify your investment. “Never put all your eggs in one basket” should be your guiding philosophy always.

Recommended article: A simple guide to saving and investment-regardless of how much you earn

It ia always advisable to spread those investments to different sectors. This helps to prevent a total loss of capital. Should one venture fail you will still smile by the courtesy of other performing ventures.

Also, do not expect to reap immediately from your investment. Businesses do not turn profits overnight.  Investment, like wealth creation, is a slow process. Exercising patience while monitoring your investment growth is essential.

 4   Not having clear goal for investing

Formal sector workers throughout the world save towards retirement through a mandatory monthly deduction. So, to a certain extent, these workers have a cushion in old age. However, this may actually not be enough in old age. It is therefore important to have a goal to which you commit a given fee.

In addition to your mandatory pension plan, work out other medium- or long-term needs for which you might need to save through investment. With a clear purpose in mind, you will go the extra mile to reduce expenditure in order to achieve your goal.

Empower yourself to rise above these mistakes and take control of the future.

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