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10 Worst Money Mistakes People Turning 30 Want All 20-Somethings To Know

10 Worst Money Mistakes People Turning 30 Want All 20-Somethings To Know

We all make mistakes – whether small or big; we humans are prone to imperfections. When making mistakes relating to money, these can often be harmful. Here are 10 money mistakes that can potentially prove dangerous for people who are turning 30 or will be soon.

1. Not being able to save where it actually matters

Saving is one of the basics of life. However, if we save, and it doesn’t matter, why save? The key to saving is saving where it actually counts and actually matters. Investing is definitely important but don’t burden yourself.

2. Focusing on the next generation’s future (ie. education) and forgetting about retirement

It’s great to focus and pay attention to your kids. Retirement is also a big factor and you don’t want to put that off until later. Make sure you invest your time and money on your retirement also.

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3. Forgetting about insurance

Insurance is a valuable resource and tool in today’s day and age. Why lose focus on it?

Later in life, around your 40’s and 50’s, you can’t be sure what will happen. Instead of assuming everything will work out exactly as you’ve planned, be careful, and invest in your insurance, as it will provide you with extensive coverage and peace of mind.

4. What about Long-Term Disability Insurance?

When talking about mistakes, we must talk about long-term disability insurance. Many neglect this aspect of life.

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Statistics show that over 25% of Americans will be disabled before retirement. Do something before this takes a toll on you. It is always an advantage to be safe rather than be sorry. Make the right choice. Get that long-term disability insurance in check and working for you. You’ll be happy you did.

5. Forgetting to discuss money as marriage plans approach

Marriage is an expensive time in anybody’s life. Forgetting to discuss what money will be invested and spent is a huge mistake especially during a time when saving money is of great value.

6. Spending absurdly on that wedding we talked about

We all dream of having the perfect marriage with the bright and fancy colors. However, going overboard, when financial discretion should be shown, is a mistake many 20-somethings make. Don’t let it happen to you. Conserve when you can. Spend when it’s necessary and when it adds significant value. Don’t uselessly spend money where it doesn’t need to be spent. This can become a huge mistake that is sometimes irreparable.

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7. Wasting endless amounts of money on the first child

There is a huge difference between pampering and providing what your child really needs. A first child is every parents dream, but spending too much on the first child deprives the children who are born later. What if you spend so much on the first kid, and then forget to do it, or not have enough money for the rest of the kids? You don’t want to let this happen as all kids deserve to be treated equally. So, make you sure conserve some of your money here.

8. Car crazy

We all dream of the perfect car that looks amazing, speeds, and shimmers on the highway. However, spending excessively on that particular dream car, may lead you to doom. Don’t let yourself go all out on it. Conserve here again so you won’t regret later on in life especially when your thirties arrive.

9. Graduate School

Graduate School is a wonderful place to continue your education, knowledge, and build on your resume. However, having said that, don’t just waste money there, if you don’t really know what to do in life. If you have a clear plan, go all out to graduate school and secure your place. However, Graduate School is primarily expensive and is not for the masses. If you think you can do it, great! If not, disregard this option and continue working.

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10. Getting a job for money’s sake

Don’t do this. Money will come and go. Prepare for the next phase of your life but don’t push away dreams and aspirations for the sake of money. Money isn’t everything in the world. It is a safety net but it isn’t everything. You can’t buy away your love or dreams, so don’t do this.

Instead do something you love, and then hope to make a ton of money in the future. Just don’t do it for the present moment. Think about your long term goals.

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Ramanpreet Kaur

Currently a student but don't know what direction to go in: Let us see if writing gets me anywhere :)

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Published on November 20, 2018

The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

The truth is, there are many “money saving guides” online, but most don’t cover the root issue for not saving.

Once I’d discovered a few key factors that allowed me to save 10k in one year, I realized why most articles couldn’t help me. The problem is that even with the right strategies you can still fail to save money. You need to have the right systems in place and the right mindset.

In this guide, I’ll cover the best ways to save money — practical yet powerful steps you can take to start saving more. It won’t be easy but with hard work, I’m confident you’ll be able to save more money–even if you’re an impulsive spender.

Why Your Past Prevents You from Saving Money

Are you constantly thinking about your financial mistakes?

If so, these thoughts are holding you back from saving.

I get it, you wish you could go back in time to avoid your financial downfalls. But dwelling over your past will only rob you from your future. Instead, reflect on your mistakes and ask yourself what lessons you can learn from them.

It wasn’t easy for me to accept that I had accumulated thousands of dollars in credit card debt. Once I did, I started heading in the right direction. Embrace your past failures and use them as an opportunity to set new financial goals.

For example, after accepting that you’re thousands of dollars in debt create a plan to be debt free in a year or two. This way when you’ll be at peace even when you get negative thoughts about your finances. Now you can focus more time on saving and less on your past financial mistakes.

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How to Effortlessly Track Your Spending

Stop manually tracking your spending.

Leverage powerful analytic tools such as Personal Capital and these money management apps to do the work for you. This tool has worked for me and has kept me motivated to why I’m saving in the first place. Once you login to your Personal Capital dashboard, you’re able to view your net worth.

When I’d first signed up with Personal Capital, I had a negative net worth, but this motivated me to save more. With this tool, you can also view your spending patterns, expenses, and how much money you’re saving.

Use your net worth as your north star to saving more. Whenever you experience financial setbacks, view how far you’ve come along. Saving money is only half the battle, being consistent is the other half.

The Truth on Why You Keep Failing

Saving money isn’t sexy. If it was, wouldn’t everyone be doing it?

Some people are natural savers, but most are impulsive spenders. Instead of denying that you’re an impulsive spender, embrace it.

Don’t try to save 60 to 70% of your income if this means you’ll live a miserable life. Saving money isn’t a race but a marathon. You’re saving for retirement and for large purchases.

If you’re currently having a hard time saving, start spending more money on nice things. This may sound counterintuitive but hear me out. Wouldn’t it be better to save $200 each month for 12 months instead of $500 for 3 months?

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Most people run into trouble because they create budgets that set them up for failure. This system won’t work for those who are frugal, but chances are they don’t need help saving. This system is for those who can’t save money and need to be rewarded for their hard work.

Only because you’re buying nice things doesn’t mean that you’ll save less. Here are some rules you should have in place:

  1. Save more than 50% of your available money (after expenses)
  2. Only buy nice things after saving
  3. Automate your savings with automatic bank transfers

These are the same rules that helped me save thousands each year while buying the latest iPhone. Focus only on items that are important to you. Remember, you can afford anything but not everything.

How to Foolproof Yourself out of Debt

Personal finance is a game. On one end, you’re earning money; and on the to other, you’re saving. But what ends up counting in the end isn’t how much you earn but how much you save. Research shows that about 60% of Americans spend more than they save.[1]

So how can you separate yourself from the 60%?

By not accumulating more debt. This way you’ll have more money to save and avoid having more financial obligations. A great way to stop accumulating debt is using cash to pay for all your transactions.

This will be challenging, depending on how reliant you are with your credit card, but it’s worth the effort. Not only will you stop accruing debt, but you’ll also be more conscious with what you buy.

For example, you’ll think twice about purchasing a new $200 headphone despite having the cash to buy them. According to a poll conducted by The CreditCards.com, 5 out of 6 Americans are impulsive spenders.[2]

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Telling yourself that you’ll have the discipline to not buy things won’t cut it. This is equal to having junk food in your fridge while trying to eat healthy–it’s only a matter of time before you slip. By using cash to make your purchases, you’ll spend less and save more.

A Proven Formula to Skyrocket Your Savings

Having proven systems in place to help you save more is important, but they’re not the best way to save money.

You can search for dozens of ways to save money, but there’ll always be a limit. Instead of spending the majority of your effort saving, look for ways to increase your income. The truth is that once you have the right systems in place, saving is easy.

What’s challenging is earning more money. There are many routes you can take to achieve this. For example, you can work long and hard at your current job to earn a raise. But there’s one problem–you’re depending on someone else to give you a raise.

Your company will have to have the budget, and you’ll have to know how to toot your own horn to get this raise. This isn’t to say that earning a raise is impossible, but things are better when you’re in control right? That’s why building a side-hustle is the best way to increase your income.

Think of your side-hustle as a part-time job doing something you enjoy. You can sell items on eBay for a profit, or design websites for small businesses. Building a side-hustle will be on the hardest things you’ll do, be too stubborn to quit.

During the early stages, you won’t be making money and that’s okay. Since you already have a source of income, you won’t be dependent on your side-hustle to pay for your expenses. Depending on how much time you invest in your side-hustle, it can one day replace your current income.

Whatever route you take, focus more on earning and save as much as possible. You have more control than you give yourself credit for.

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Transform Yourself into a Saving Money Machine

Saving money isn’t complicated but it’s one of the hardest things you’ll do.

By learning from your mistakes and rewarding yourself after saving you’ll save more. What would you do with an extra $200 or $500 each month? To some, this is life-changing money that can improve the quality of their lives.

The truth is saving money is an art. Save too much and you’ll quit, but save too little and you’ll pay for the consequences in the future. Saving money takes effort and having the right systems in place.

Imagine if you’d started saving an extra $100 this next month? Or, saved $20K in one year? Although it’s hard to imagine, this can be your reality if you follow the principles covered in this guide.

Take a moment to brainstorm which goals you’d be able to reach if you had extra money each month. Use these goals as motivation to help you stay on track on your journey to saving more. If I was able to save thousands of dollars with little guidance, imagine what you’ll be able to do.

What are you waiting for? Go and start saving money, the sky is your limit.

Featured photo credit: rawpixel via unsplash.com

Reference

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