It’s life: everybody makes mistakes. Mistakes teach us and make us wiser, especially financial ones. However, it’s difficult to stay on the top of your finances while being ignorant about the financial traps most people fall into. Therefore, it’s essential to stay prepared and alert as this may prevent you from making basic mistakes.

Here’s a list of the most popular mistakes which may harm your financial life and put serious obstacles in a way to your prosperity.

Getting Too Many Credit Cards

While all consumers would like to find the best credit card option with the most convenient terms and conditions, it’s not always a good decision to apply for every card out there as it’s likely to hurt your score. For every card you apply for, and for each time your credit score is ran, there will be a ding against your credit.

Therefore, do your research beforehand and find the best card that meets your needs. After you’ve selected what will work for you, only apply for a few of them.

Not Checking Your Credit

Every person has a right to a free check of their credit report from each of the 3 major credit bureaus: Equifax, TransUnion, and Experian. This free report is limited to an annual basis, but you can check it more often by paying a fee.

More read: 3 way to make money at home with your own business.

It’s suggested that you should check each of these reports at different times throughout the year; basically every 4 months as there are 3 companies that have information about you. Go through each report and verify you own that debt and it’s been reported correctly. If you see something you disagree with, or a debt that you aren’t responsible for, then be sure to dispute it and get the information removed.

Lending Money to Family and Friends

Do not mix finances and personal relationships. Lending money to friends can destroy good relationship, so it’s better to avoid it.

In regards to your credit, co-signing for a family member or friend’s loan means that you’re completely liable if they don’t pay. Many people fail to realize this, but if they miss a few payments, or are late a couple of times, it’s going to damage your credit (as well as theirs).

Covering Daily Expenses with the Help of Short-Term Loans

Credit cards may help you to make some purchases, in case you are short on cash, but they should not replace cash in you wallet. Lots of consumers today use short-term loans and payday loans to cover casual expenses and it’s not right. It only makes sense to take out a payday loan in case you really have an emergency and there is no other way for you. These loans are not intended for casual usage because they have extremely high interest rates.

Having Late and Missed Payments

Missed and late payments are the enemies of good credit. So create a payment schedule and if you know that you may forget to pay some bills, put this list in a place where you will see it each day. The first step to building good credit is to be a responsible borrower and make payments on time. So do your best to pay all the bills before their due dates.

Finding Excuses for Not Saving Money

Having an emergency fund is very important. Yes, it can be difficult to save some money when you have a limited budget, but it’s impossible to understate the importance of having cash in the bank for rainy days. You will feel more financially protected if you have some savings and in case unexpected financial problems arrive, there will be no need to borrow money and go into debt.