Most people make predictable financial mistakes that cost them thousands of dollars over their lifetime. Awareness of these mistakes is the first step to avoiding them.
Mistake #1: No Emergency Fund
Without an emergency fund, unexpected expenses force you into debt. Build 3-6 months of expenses before investing or paying down debt.
Mistake #2: Carrying High Credit Card Debt
Credit card interest rates exceed 20% annually. This is one of the most expensive types of debt. Pay off high-interest cards immediately.
Other Common Mistakes:
- • Not having a budget
- • Lifestyle inflation
- • Not investing for retirement
- • Paying too much in fees
- • Ignoring your credit score
- • Not diversifying investments
- • Trying to time the market
- • Borrowing for depreciating assets
How to Avoid These Mistakes
Create a budget and stick to it. Build an emergency fund. Invest consistently. Keep fees low. Monitor your credit. Think long-term. Avoid emotional financial decisions.