We all want to have a stable financial life and save more money to spend on the things we like. To achieve all of this quickly we are bound to make some financial mistakes.
There are many big financial mistakes people make that end up hurting you in the long run, as well as financial blind spots that you may not even realize you're overlooking. Learn from these mistakes, so you do not make the same mistakes in the future.
Using Credit Cards For Your Spending
If you do use a credit card, once or twice, for your day-to-day spending, you should be fine as you can quickly pay your debt. But if you rely on your credit card for everything from paying for your groceries to big purchases like a new piece of tech, then you are in for big trouble.
In a short amount of time, you will amass a big debt that will make your life extremely difficult later when you are trying to pay it. Try to avoid using a credit card for your purchases as much as possible.
Save Money By Dropping Your Insurance
One quick thing you might think when trying in order to save more money is to completely drop your health insurance. You might think something along the lines "I am healthy, nothing is ever going to happen to me and I am paying monthly for something I haven't really used" and decide to drop the health insurance.
While that argument, at that moment, might make sense, it's something you definitely should not do. Tragedy can strike at any moment without any warning and you can never know what might send you to the emergency room. Without any health insurance, the hospital costs will destroy any financial freedom dream that you might have had.
So, what can you do? You can begin searching for a better health insurance provider that offers a high deductible health insurance plan and the money you save from that can be invested in a health savings account.
Skipping On Saving For Retirement
"I am young, why do I need to save for retirement? No, I will spend my money now for fun, let future me deal with that" is amongst the worst thing you can probably think and do to your future self. Even if you are young, you should always contribute to your retirement plan some part of your earnings.
It doesn't matter if it looks like you are saving too little at first. With the power of compounding, that small amount of money put into a retirement plan each month can grow to a pretty big size by the time you are ready for actual retirement. Once you reach that part of your life and can still afford to live a financial freedom life, you will thank your past self.
Taking Big Decisions Quickly
We've all been there during Thanksgiving dinner or any other family gathering for that matter, where people try to nudge you to take the next big step, even when you are not ready. Buy a car, buy a house, get married or start a family, etc. are big decisions to make in life, and only you know when the time is right.
Don't rush into things just cause of outside pressure. Don't take a leap of faith when you don't know that there's a bunch of bales of hay to dampen your fall (yes, I made an Assassin's Creed reference). Take your time, plan for these things carefully and when you are ready, do it.
If you use an app like MoneyCoach, it can help you avoid these financial mistakes and help you reaching your financial freedom dream even faster.
