5 Common Mistakes With Personal Finance and How To Fix Them

Mon, Oct 7, 2013

Budgeting

The world of personal finance is no doubt capricious and fleeting. The ups and downs, comprising wild day-to-day Wall Street rides for some, can fill their lives with anxiety as well as elation. Cite the wound-licking from the 2008 crash that has now come to teach us investors that we have to be smart and diligent with our nest egg.

Common financial mistakes, however, are still made, just as they have been historically. What is also historical about these mistakes is that there has never been a better time than the present to fix them.

The following five most common personal financial mistakes are what advisors regard as also the easiest to mediate. Have a reflective look at them, and see if they concur with your own financial situation.

Late Payment on Bills

Paying your bills late can constitute a huge financial faux pas. And that faux pas can add up to $10 to $50 per month in late fees depending upon who you’re making this error with. In fact, late payments can be so much of a mistake, not only might you go broke because of the fees themselves, you might also find yourself on a credit rating blacklist.

The simple solution, whether paying your bills in full or in monthly increments, is to pay whatever you can before the due date. If it helps, put your due dates on a calendar, or if you’ve a bunch of bills due at the same time, call the companies owed and ask if the due dates can be changed. For assistance in financial matters like the ones mentioned here, National Debt Relief has been proven to assist those in need.

Leaving Yourself Uninsured

So you we were bulletproof in our twenties, right? Well, maybe, maybe not. But what’s going to happen in your thirties, forties and fifties when you have a little wear on your treads? Waiting too long to get health insurance can be a huge financial mistake only because insurance companies take into account age as a factor toward higher premiums. Additionally, just from the fact that no one is bulletproof and sickness, injury and even death can occur to anyone at anytime, avoiding self-insurance is really nothing more than a financial gamble.

Just consider the fact that if a person insures themselves at 25 instead of 55, they can save up to $30,000 for that three-decade period.

What to do in this instance is have insurance. The sooner you get it, the cheaper the monthly bill and deductible will be. Especially now with the Affordable Care Act, there is no credible reason a person should not have health insurance.

Home Insurance: The Overpayment Plan

A recent ACE Private Risk Services study found that 78 percent of independent insurance agents believe homeowners are overpaying for their house insurance.

Now if that is the case, the first thing you should do is check your policy. See how it stacks up to other companies’ policies. If the trend is level from one provider to the next, raise your deductible so that the insurer will lower your premium.

Not Breaking Into Tax Breaks

Taxes, they’ll just keep coming and coming while eventually rising higher and higher. This is why you can’t meekly approach Uncle Sam, but must instead confront him for your fair shake as far as tax breaks go.

Talk to a good accountant. See what you can deduct. Student loans, car payments if you drive for a living, materials if you work out of your home. There could be a wealth of monies you might not know the government owes you.

Avoid Retail

You might not think of buying retail as a financial mistake, but in this world of big box stores that provide deep discounts on name brands, as well as the internet which traditionally offers products far below that of brick and mortar establishments, to pay full price for anything seems more and more like a financial snafu.

So to that, shop around. Look online. And don’t be afraid of the Costco or Wal-Mart world. It’s gotten to the point now where smaller grocery and clothing chains feel the need to compete with volume-centric chains like Costco and Wal-Mart, making a financial remedy easier to achieve for the retail mistakes of the past.

Dave Landry Jr. is a finance and business blogger who enjoys advising and writing to those in need. He hopes that you enjoy reading this article as much as he has enjoyed writing it.

 

2 Responses to “5 Common Mistakes With Personal Finance and How To Fix Them”

  1. Simon @ Modest Money Says:

    Certainly agree with your assertion on taxes…one should do everything in their reach to pay as fair an amount as possible (read as little as possible). Make all possible legal deductions and go for all the loopholes you qualify for as long as they don’t cost much that you will be saving!
    All in all, with a bit of research, financial plan and an avoidance of the mistakes mentioned above, one can certainly fix their financial lives or lay the foundation for that to happen.
    Simon @ Modest Money´s last blog post ..Barclaycard Rewards MasterCard Review

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  2. financial advisor beverly hills Says:

    By the way, I was at an event called “generation debt” in LA and one of the panelists mentioned your site as one the girl frequents regularly regarding advice.

    Reply

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