Don’t Make These Money Mistakes!

Bestselling author Elizabeth Gilbert once said there are three types of people in this world:

1. People who never learn anything.
2. People who learn from their own mistakes.
3. People who learn from the mistakes of others.

Our goal is to help you be the third type of person – the one who learns the valuable lessons without enduring the pain and suffering that goes along with them. Countless people have made the money mistakes listed below; here’s how you can avoid being one of them:

Mistake #1: Not having a plan.

When it comes to personal finances, like most things in life, you should always have a plan. Without one, you will be blindly spending and saving your money with no idea how it is impacting your long-term goals. Sit down and take the time to map out your most important financial objectives; such as how you are going to get out of debt, fund your retirement, or send your children to college.

Mistake #2: Not having a budget.

Budgeting is the best way to take control of your finances. For best results, you should have both a short-term (monthly) and a long-term (yearly) budget. If you are new to budgeting, you can use the 50/30/20 rule to help get yourself started:

• 50% of your income to essential expenses: houses, transportation, groceries
• 30% of your income to lifestyle choices: travel, dining out, shopping
• 20% of your income to financial priorities: retirement, savings, debt

Mistake #3: Not understanding the importance of your credit score.

Your credit score shows potential lessors how you’ve managed your finances over time. A good credit score can save you thousands (or even tens of thousands) of dollars when it’s time to make large purchases, such as buying a home. Developing these habits now will put you on the path to a good credit score in the future:

• Pay your bills in full and on time every month.
• Don’t exceed more than 30% of your available credit.
• Check your credit score three times per year, and dispute any mistakes you may find.

Mistake #4: Not seeking help.

Navigating through your personal finances on your own is difficult. Having a professional financial advisor by your side can help you make tough decisions and avoid falling into common pitfalls -- such as the ones listed above. You may need to pay for their services, but the money you can save in the long run makes it a wise investment.

Looking for more money mistakes you should avoid making? Check out this article from Forbes.com.

American Investment Planners offers financial planning services to individuals and families across the country. Whether you are starting your first job, planning for retirement, or both, we can help you achieve and exceed your financial goals.

To schedule an appointment with one of our advisors, please call (516) 932-5130 or email info@americaninvestmentplanners.com.