A financial planner shares the five biggest money mistakes people make. How many do you make?
Managing money isn't easy. Otherwise we'd all be perched on piles of money, counting our cash.
But there are steps to take to improve your financial health.
Kraft shared what he sees are the five biggest mistakes people make when it comes to managing their finances.
1. Spending more than you make
Put another way, living beyond your means. To have any type of financial success, Kraft said you need to do the opposite. "You have to spend less than you make, and save for as long as you can, and that's where the power of compound interest and investing can create that millionaire next door," he said. "You don't need to make
2. Not having an emergency fund
Kraft said he recently had car trouble and had to take his car to the shop. He paid for it out of his emergency fund. Kraft said many people lean on credit and debt as opposed to having three to six months' worth of expenses — or even "a couple thousand dollars" — set aside to cover unexpected expenses. "And the power of that emergency fund, the psychological power is important," he said, "but also financially, and just not having to rely on credit card debt or credit to get out of an emergency."
3. Only making minimum payments on credit card debt
This is a fundamental one, Kraft said, and depends on your cash flow, but it's a scenario he sees play out again and again. People make just the minimum monthly payments on their credit card debt, thinking it's going to remedy the situation. Why people do it is a "loaded question," Kraft said. Some simply are stretched too thin to pay more than the minimum. For others, it's a question of not being educated, and they're digging a deeper hole. But Kraft said personal life decisions play a part, too. "Like, do I want to go out and have a fancy dinner, or do I want to make an extra
4. Failing to plan for large purchases
Whether it's college, or a new vehicle or another big-ticket item, Kraft said planning for those purchases — or failing to do so — can really help or hurt. "Sometimes people know that they're going to have to do this, sometimes years in advance — whether it's a car or college or whatever it may be, a larger purchase — and (they) don't start saving or don't start planning for it. They just go right to finance, go right to debt, and that ends up eating away at their monthly budget and their ability to create wealth."
5. Inconsistency in saving
The way that compound interest works is that you have to do it on a regular basis, Kraft said. You need to save and set aside money and do it consistently. "Those that are able to make good financial decisions, saving decisions, and do it consistently over a long period of time, that's where the compound interest kicks in, and that's really where people can win with money, as opposed to, hey, I'll do it this month then not next month or I'll get to it when I can," Kraft said. "But then you also have certain fads or meme stocks, or even higher-risk stuff that people get into or get in and out of, and it hurts them for the long haul."
Learn more
Those and other topics will be covered
Special sessions will be geared toward teens, and will help them explore how their decisions about college, career, budgeting and saving will affect their lives.
"Decisions that teens need to make early in life can have implications that impact them for decades," Kraft said. "It is so important that all teens have the opportunity to get exposed early to the concepts that will ultimately translate to a financially empowered life."
Parents and guardians are welcome to join the teen sessions.
For adults, classroom-style workshop sessions will provide an overview of key topics such as
There will also be breakout sessions where attendees can meet one-on-one with a financial planner to discuss their personal goals and action steps to achieve them.
All services are provided free of charge.
The event, which includes a free lunch and raffle prizes, is free with registration.
Free Financial Planning Day
When:
Where:
Sponsor:
Cost: Free with registration. To register, bit.ly/3dcXSEi or call 414-343-9126. The deadline to register is
Contact
Health Insurance Carriers Market May See a Big Move : Allianz, Aegon, UnitedHealth: Health Insurance Carriers Market 2022
California to again protect insurance policies in fire areas
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News