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Don’t make financial moves that you will regret forever


Everyone makes hundreds of financial decisions in their lifetime and no one ever makes them all correctly. However, there are a few mistakes that everyone needs to avoid to avert financial catastrophes. These are decisions that can have long lasting consequences.
 
What are the general areas that people can make serious financial mistakes?
The decisions that people make and end up regretting later are mostly regarding their kids,  their retirement savings and their use of credit.
 
Let’s start with kids, what are the biggest mistakes?
There are two main mistakes that parents make. First is feeling compelled to give your kids everything, even if it creates a financial hardship. Parents can overspend on vacations, cars for their kids and even entertainment.  It also creates poor financial habits in their kids leading.
 
What is the second decision that people may regret when it comes to their kids?
Choosing an expensive college that requires the parent, the child or both to borrow heavily to pay for it. College choices need to be made with a realistic idea of what the first five years of earnings after college will be. Expensive colleges that lead to higher earning jobs might be worth the cost because the after college value is so much greater.
 
What is the biggest mistake in regards to savings habits?
It is basically not being disciplined to start saving for smaller expenses such as vacations, furniture or even having funds for car repairs or other unexpected life events. Not using savings for these types of expenses also results in the final cost being higher due to the amount of interest that has to be paid.  And often times all of this borrowing leads to debt overload.
 
What are decisions that can be serious mistakes regarding retirement?
Deciding to wait to start saving for retirement.  Prioritizing houses, cars, kids’ educations and vacations over retirement savings can be devastating in regards to reaching retirement goals.  Waiting just 10 years can often mean you will need to save twice as much per month just to reach your goals.
 
What is the most important decision regarding credit?
Without question it is the decision to pay your loans and other bills on time. The impact on a person’s credit score can be significant even to the point that credit is not available to them or even job opportunities are missed. Plus, any credit they do receive will be extremely more costly which impacts their financial situation even more.
 
How can a person avoid making decisions they will regret later?
Seek professional advice and create a true financial plan. Without a plan, everyone is more likely to make poor decisions. To develop a feasible and realistic plan we all need professional advice and coaching.  Spending money to get the right advice regarding your financial matters is almost always a smart investment.
 


Posted: 8/10/2017 with 0 comments

Categories: Credit, Insurance, Investments, Money Matters, Retirement, Saving, Spending



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