Welcome together, we're going to explore our personal finances and figure out how to improve them. Whether you're just getting started in life on your finances, or you may already have a home, a car payment, and you're struggling to get credit cards under control, or you may be getting a late start in life on saving for retirement, reduced that increased wealth.com is a podcast to educate those to improve personal finances, whether it's eliminating debt, or making smart investments. Mr. Chuck here, in this episode, I'm going to be talking about mistakes that we make. And this is financial mistakes. We all made a few. Hopefully, not this many. But this is a list of 22 mistakes people make on their finances. And I found this article and listen money matters.com financial mistakes. So we all know what the big ones are not having a budget not investing and running up your credit cards, if you avoided or overcome those mistakes well done. But you may not be out of the woods yet. And here's a host of mistakes people make with their finances. And here are some you might look out for. You don't pay yourself first. And I'm guilty of that myself. And I've always were paying my bills and trying to make extra payments on my credit cards. Before I discovered I was better off by making the minimum payments on my credit cards, and putting in extra money they save into a savings account and building up an emergency fund. So I didn't have to use credit cards in the future. That's Mistake number one. Number two, you have no debt plan. He may think you have a debt plan, but you probably don't. It's not enough to make a payment every month, especially just a minimum payment. If you have debt, you need a plan to tackle that. And you can use the snowball method or the avalanche method or my method. And I've talked about that in earlier episodes, I'm not going to go back, but a detail plan. The date that you start, which credit cards you want to pay off to zero, what the minimum payments are and how much you think you could save on a two month or a three month period and how much extra you could apply to that credit card debt. And a goal when do you want to get it paid off in one year, 12 months, or maybe 18 months and set a reasonable goal. But if you just jot it down, then you have a more defined plan. Number three mistake we all make is you ignore your credit score. I did that for years, I didn't even know what my credit score was. But I knew that if I make on time payments and you know, don't be late, don't get in over your head don't apply for too much credit that I would probably have a good credit score. But now these days with the internet, it's much easier to keep track of it and you can check your credit score Credit Karma. You don't ever have to pay for a report you can get your reports once a year for free from all three credit agencies. Then Mistake number four is your assess with your credit score you pay too much attention to your credit score. You got to remember your credit score is use for when you buy insurance or get loans or maybe you're if you're renting an apartment for a landlord if you're looking to move to a different apartment. But don't keep checking it every day. Just make your on time payments and pay off your credit cards and try to pay off any other loans you have and your credit score will be adjusted. Accordingly quarterly the mythical 850 you'll probably never reach that. It's very difficult and I don't even know why they have it because I don't know anybody has ever reached it. Number five no runners insurance. your landlord check your score was excellent. You got the apartment you assume the owner of the property has insurance. He don't need it wrong. The owners policy will coverage damage to the structure but not your business. So if you are renting an apartment or a condo, you need renter's insurance to cover all your belongings, all your furniture, and all your clothes and whatever else you have in there. Number six mistake we make is you pay full price for everything. And nowadays, you never have to pay full price for any anything, there's just too many ways to avoid doing. So. Even if you just go online and shop online, there's many discounts and sales that you can get that if you walked into the store you may not get, you can also get your small appliances at thrift shops. And you can get free furnitures on Craigslist. Now this is according to the article. He can get discounts and coupons about anywhere. I know a lot of you're probably already doing that for your groceries and things you buy on a regular basis. So just keep doing it and try to expand on not paying full price for anything. And number seven, you don't ask for help. I don't mean you don't ask to borrow money lending money is later on this list as a mistake. Whatever problem you're having credit card debt, you don't know how to make a budget, you brought a new car now you can't afford it. I guarantee at least one person, you know has the same problem. And if no one has they're lying, Google is kind to those in need. So even though you don't ask somebody personally, you can go online and Google what your problem is, like I can't afford to make your car payment, what do you do, you can probably Google that and come up with some answers, the first thing you want to do is contact your lender and tell them the reason and why like you're unemployed. And you'd like to, you know, get an extended, but don't be afraid to ask for help. And that's what this podcast is all about. Number eight, you always choose Money, money should never be the only consideration when making a decision. It's up there but shouldn't be alone, you need to consider all other things other than money first. And number nine, you don't ask for a raise. I never asked for raising my working career. One because I didn't think I'd ever get it. And two, I don't know why I just never I was afraid to maybe raise fairly, doesn't fit around the office, just hand on them out. And if you just wait to get a raise, when they give you one, you're probably just gonna get the 2% that gets that what raise that everybody's gonna get it, you need a big increase. So you're going to have to ask for it. Now you want to ask for it. And after you did something significant, say say that you work in an office and they assigned you a project and you as the project leader, and you carried it out, you met all the goals and you did fairly well and everybody was happy. Right after you get that done, you should go to your immediate supervisor and say I did a good job on this project. And I would like to have a pay raise and timing is everything. And number 10. You don't change jobs. Even if you ask for a raise and got a nice one, it's likely to be nowhere near the bump you could get if you switch companies. And you should probably be doing it often every two years. And in fact, in this day and age, there's no such thing as Laura t to your employer. If you did something wrong or bad, you think they're going to keep you around because you're loyal to them. Not likely. You can get better bombs and increases and promotion. If you change jobs, depending on your field. It could be significant. That's the top 10. Okay, number 11. Number 11 you're doing it because this is one to lots of things, going to college, getting married, buying a house, having a child and those can be all the wonderful things but they're not for everybody. Why are you going to do those things because you're supposed to, according to whom society, your friends, your parents. None of those are good reason to make major life decision. If you do something, do it because you want to do it and because it's a good decision for number 12 buying a house this is another one where the non monetary benefits can outweigh the monetary negatives. If you have a family putting down roots is important. If you have children buying a home, in a good school district can make sense. As mentioned above, and shouldn't be something you do just to check off another box on this stuff grown ups do. Remember, when we talked about making better money through changing jobs. And when you change jobs, you might be moving a lot. And when you move, owning a home can be more of a hassle. And also, I think I covered it in previous episodes that it may be better or cheaper for you to rent than to buy. Depending on the area, that country you live in the prices of homes and the costs associated. But if you're going to move around, you definitely want to wait until you get somewhere where you know you're gonna stay. And 13 is buying too much house. This is so backwards since 1973, the size of the average home has increased by more than 1,000 square feet from 1,660 t,o 2679. While the average number of occupants have decreased from three to two and a half more room for fewer people. And the more room you have, the more crap you buy to fill it up compounding the problem. And the more you buy, the more likely you're going to be using credit cards and start getting credit card debt. This because you're approved for$250,000 mortgage doesn't mean you have to spend that much. If you decide to join the quiver, full movement down the road, you can always upgrade to a bigger place. Number 14. Yeah, buying too much house. If you're a single person, I always bought a three bedroom home because I was buying it based on resale value. And that's what you need to keep in mind. Do you need a 3000 square foot home that's gonna cost you a lot of money to heat and cool. When you can get by with maybe a three bedroom condo, it's gonna save you a lot more money and heating and cooling. Just something to consider before you buy too much house. Number 14. You have no idea how much a child costs? Well, we know they're expensive. And here's some numbers and childcare and education is$44,400 housing and transportation $108,000 food$39,000 clothing and miscellaneous $33,780. Healthcare $20,000 Yes, the total cost for a child is$245,340. And that's not including the cost of college, which is gonna probably double that number. I know you pay for it over time, but just be aware, I guess you could say it's cheaper to have more than one child, because then you can have the hand me down stuff like my family did. It's up to you. Number 15. You don't teach your children about money. While you're going to have to because schools mostly don't. And you need to start young around the age of three. Because by the time the kids are seven, their ideas and habits around the money are largely and plays. You got to teach them that they cannot have everything they want. And that's probably one of the bigger mistakes I've seen parents make when raising their children. If you instill good money habits in your children, you can set them up for a lifetime of success and save them so much stress and heartache. We have all said it to ourselves. If I knew when I what I know now, I would make sure you chill kids. Don't ever had to say that fruto phrase at least when it comes to money. Number 16 you lend money. This one is so hard. Hopefully everyone Your life is so bold to ask for money is someone you love and not some random in law you only see a holidays. You can tell those people to piss off. It's harder when someone you care about. But it's such a bad idea. For the same reason. co signing alone is a bad idea. If you don't get paid back, it might be the end of the relationship. If you write it off as a loss and don't hold a grudge. The borrower may avoid you out of shame. That doesn't mean you can't help perhaps have exhausted every other option before coming to you, but probably not. Maybe they can get a loan from Lending Club, maybe you can help them figure out a side hustle. Maybe they have money coming in, but don't budget so don't realize how many relatively painless cuts they could make to keep some cash. So instead of giving the money, you can help him set up a budget 17 co signing alone. There are good reasons to do this, but not many. In fact, I couldn't find one that I thought was good enough reason to convince me to do it. So I'm not going to tell you, you should. I'm always looking out for you. Don't cosign alone, because if it loan gets default on the lender is going to come to you. And you might have to use money, you don't want to pay it off. And if it's on a car, they're still going to have the car and then now they're not going to have a loan. And because you paid it, they're going to get the title of car, they can sell it and get some cash and never pay you back. Just a note 18 using retirement to pay for college. I know you want to help your children get an education. And there are ways you can do that help them apply for grants and scholarship. Start a 529 plan, talk to them about various options like attending a community college for the first two years. What you should not do is raid your retirement accounts to pay for it. Your children has a lot longer to work and pay back college loans. If they have to take them out then if you have to work to fund your retirement, they will not thank you if you have to move in with them because you can no longer work but don't have enough money to live on. Remember, you cannot borrow money for retirement. I've been saying that many times in episodes. So don't raise your retirement fund to pay for your children's or grandchildren's college education. And 19 you pay too many fees. You're probably diligent about making sure you don't pay things like ATM fees, late fees on bills and credit cards and checking account fees. And that's great. He should avoid fees when you can but these fees are nickel and dimes compared to we might be losing money on fees and Americans pay more than 600 billion and investing fees every year. Individually, we lose about one third of our retirement savings to fees and fees X can help you find avoid fees on your investment. I don't know anything about fees x. So the only thing I know is your investment advisor should be a fiduciary. And they generally charge you at percent of your portfolio. If you can group your family together, parents and children, brother and sister of the parents and one investment advisor, what my investment advisor was to group all over portfolio amounts together looked at the fee because the more you have, the less percentage you have to pay. So if you can group multiple people's investments together, you can get a larger portfolio that's not all yours, everybody will get a reduced reduction and fees. Just a word of thought. Number 20. You don't re evaluate. You don't go back and look at your options. You don't look at your personal finance plan to update your short term mid term long term goals. When you reach a goal, you need to take it off your plan out of your plan. When you get your debt paid off, you need to take out you need to get rid of your debt reduction plan. It don't longer exist. Maybe a new debt reduction plan would be make sure you don't get into debt and jot down things that you can do. Increase your savings account, increase your emergency fund. Try not to use credit cards if use credit cards, pay them off before they accrue any interest, usually every month and finally Own your mistakes. Some of these are big some of obvious not paying yourself first, or not having a plan to tackle debt for instance. But some of them are really surprising to me how much we lose investment fees and how much more lucrative it is to job hop and goes to show if you're thinking Aaron aren't making any mistakes You might be wrong. So take a look at your life, reevaluate every year. Take a look to see where you can save money, where you're spending money, where you can make more money. She asked for that pay raise at work, maybe you should look for a new job. It's all up to you. Only one person is going to improve your financial situation. And that's going to be you. That's the end of another episode. I hope you found it useful. 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