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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 January 8, 2021

How To Pay Off Credit Card Debt Fast: 7 Powerful Tips

How To Pay Off Credit Card Debt Fast: 7 Powerful Tips

Ever wondered whether your credit card debt is the reason you’re in a bad financial situation? You can’t enjoy any fun activities because a good chunk of your money goes toward debt payment. Heck, you’re even behind on some of your monthly bills.

The effects of clumsy debt management are too many to list here. This guide is going to help you discover how to pay off credit card debt fast and start chasing your financial goals.

Debt problems are the last thing anyone wants to encounter. But things can get out of hand when all the “little debts” you take accumulate in interests.

What if you knew some simple and proven ways to be debt-free quickly? Implementing them would mean better financial health for you. It becomes possible to free up cash for your “wants.” These include taking a trip or buying something you’ve always desired. All that while paying your bills on time!

Let’s not wait any longer. Here are 7 powerful tips for paying off credit card debt fast:

1. Pay More Than the Minimum Credit Card Payments

Many people only pay the monthly minimum on their credit cards. Truly, that’s the right amount for staying on good terms with your credit card company. But you need a different approach if you’re looking to achieve financial independence within a short time.[1]

Most of your payments go toward interest costs when you only pay the minimum amount. A substantial sum of your balance remains standing. As a result, it becomes more expensive to eliminate your debts.

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You don’t want to wait more than 10 years to get rid of debt while it’s possible to do it sooner. All you have to do is double that $100 minimum payment to $200 or go higher.

The good thing is that minimum credit card payments are affordable in most cases. By paying a higher amount, you reduce your interest costs, lessen your borrowing period, and boost your credit score.

2. Start With High-Interest Credit Card Debt

If you have more than one credit card debt, prioritize putting the extra money toward the ones with the highest interests. This debt pay-off strategy, known as the debt avalanche method, is essential for being debt-free quickly.[2]

First, you need to list down all the credit card debts you have in the order of their interest rates. Next, you choose the one with the highest interest and pay a significant amount toward it each month. It can be an amount twice or even thrice larger than the minimum payment.

At the same time, you make monthly minimum payments on the other debts. Their interest charges won’t be as costly as that of the first debt on your list. You only move on to the next high-interest debt after the first one is gone. Remember that your focus is on the interest rates and not the balances.

3. Revisit Your Budget

Budgeting is useful for tracking your financial moves. Once you create a budget, some tweaks along the way can make it work for you better. One situation that requires you to revisit your budget is when you’re struggling with debts. It might hurt a bit to slash some expenses. But you also don’t want to miss out on achieving financial freedom in the long run.

You can reduce some variable expenses to free up more cash for credit card debt payments. They’re the ones that change from time to time. Some examples are groceries, fuel, and clothing.

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Other opportunities for cutting down your spending lie in non-essential expenses. Instead of dining out all the time, you can cook at home more to save money. You can also share some subscriptions with friends and pay a fraction of the cost.

If you’re determined enough, you can eliminate all your unnecessary expenses and focus on paying off your credit card debt first.

4. Avoid Using Your Credit Cards

Do you want to know how to pay off credit card debt with a low income? One simple way is to stop using them. Having your credit cards everywhere you go means that you’ll be more tempted to buy unnecessary stuff. In this case, you spend money that you don’t really own and get deeper into debt.

The quickest fix to stop the debt build-up is spending with cash. You’ll be more aware of everything you can afford at any particular time. If you decide to keep one or two cards to ease the transition, always make wise choices. For instance, only use them when experiencing financial difficulties.

It’s best to categorize your fun activities under “discretionary spending” in your budget. This way, you won’t need more debt to kill your boredom. By halting your credit debt from accumulating, it’s easy to pay down what you already owe and be happy with the progress.

5. Start a Side Hustle to Boost Your Income

You’re probably turning away a lot of money by not monetizing your skills. Everyone has something that they’re good at doing. And you can use that to generate extra income for attacking your credit card debt.

If you look around your neighborhood, you can find several side hustle opportunities. It can be pet sitting, tutoring, or lawn mowing. You can start an online business by offering services such as digital marketing, content creation, and web development. Such skills go in high demand on freelance sites and job boards.

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Finding clients on social media is also a good strategy to utilize your skills and make more money. Facebook groups, Quora Spaces, and subreddits are some places to look for side jobs. You only have to join a niche-specific platform, share your services, and respond to any opportunities.

It’s possible to learn a skill, practice it, and earn from it. Use the free resources online or purchase some e-courses to get started.

6. Sell Your Used Items for Extra Cash

Starting a side hustle isn’t the only way to generate extra money. You can turn unwanted items into cash for paying off credit card debt. Whether it’s an old TV, book, or furniture, there is always someone itching to buy your used stuff.

A garage sale, as much as it’s old-fashioned, is perfect for getting your neighbors and passers-by to buy from you. You keep all the money because there are no business permits or taxes involved. While you may not make much cash, it’s better than leaving your stuff to go defunct in your storage.

Other than that, you can sell your used stuff on online marketplaces. Facebook groups are great places to start if you want quick approvals and hence sales. You only have to ensure that your listing follows Facebook’s commerce policies.

When selling any pre-owned items online, ensure they’re in good shape to avoid problems with your buyers.

7. Know When to Seek Help With Your Debt

Asking for help with your credit card debt can be challenging to do. But letting it drown you is a road you don’t want to take. While you may feel embarrassed at first, it’s the best way to get back on track when you run out of options.

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There are tons of non-profit credit counseling organizations that can offer you free guidance on how to escape the debt trap. An example is The National Foundation for Credit Counseling. They simply review your finances and help you determine the source of your financial problems. After that, they match you with an actionable debt management solution.[3]

In extreme cases, the debt solution can be:

  • Debt relief – where your debt is partially or wholly forgiven
  • Debt consolidation – taking out one loan to repay others
  • Debt settlement – the creditor forgives a significant portion of your debt
  • Bankruptcy – legal process for seeking relief from some or all your debts

It’s necessary to carefully weigh your options before deciding on the way to go. Find out how it might affect your credit score and any other risks.

Wrapping It Up

Debt is a major setback when you’re trying to prosper in life. Paying off credit card debt is essential if you want to reach your financial goals. That means having more free income, a good credit card score, and even a chance to retire early. You become more productive each day because of the peace in your mind.

So, you now have some tips on how to pay off credit fast. Go ahead and get rid of that good life progress killer!

More Tips on How to Pay Off Debt

Featured photo credit: rupixen.com via unsplash.com

Reference

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