16 Money Mistakes Everyone Has Made—Even Financial Experts
We’ve all made plenty of money mistakes in our lives. You’d expect this from the average Joe, but you’ll be relieved to know that even financial experts make mistakes with their finances, too.
Skimping on insurance
“I once turned down a dental plan—for $6 a month!—because I was 22 and had never had a cavity,” says Alexa von Tobel, founder and CEO of LearnVest. “My first-ever cavity arrived shortly after, and it was incredibly expensive to fix. The lesson? Having a financial plan—in this case, being insured—would have cost so little and saved so much money in the long run.” These 13 health insurance tricks can help you save thousands of dollars.
Not taking advantage of your FSA
“I used to ignore my Flex Savings Account whenever I got the rundown about my benefits at new jobs,” shares Woodruff. “It just seemed like a complicated thing that I didn’t have time to figure out. It was such a dumb move because the savings potential is huge, especially for me since I am constantly shelling out cash for doctor co-pays, new contacts, eye glasses, and over-the-counter meds, like allergy spray. FSA’s basically let you pay for many medical expenses from cash that comes out of your paycheck before taxes. That means you could save anywhere from 10 to 40 percent depending on your income.” Learn the eight best money-saving tips from self-made millionaires.
Not spending money to make money
“When I was first building my business, I was working 70 to 80 hours per week, doing everything,” says David Osborn, co-author of Wealth Can’t Wait. “I played that way until I got to the edge of burnout. A consultant taught me how to hire help and told me that if you don’t have an assistant you are one. So I took the plunge, taking a 40 percent pay cut and a leap of faith to hire the person who was the best fit for the job. She was amazing— and in two years I nearly tripled my income.” Here are eight money rules you should break according to money-saving experts.
Overvaluing an advanced degree
“I borrowed more than $50,000 to get a master’s degree in economic journalism,” Huddleston says. “I wouldn’t say that getting an advanced degree was a mistake. But, I should’ve looked for ways to earn money while I was in grad school to reduce the amount I needed to borrow. Plus, I assumed getting a master’s degree would pay off financially, but didn’t do any research to find out whether it would translate to a bigger paycheck. I ended up getting a job that paid the same as the job I had before getting my master’s degree. However, that degree did help me land a job with a personal finance publication and was the start of my more than 15-year-long career as a personal finance journalist.” These 12 really cool jobs don’t even require a college degree.
Committing without the details
“I got engaged to my now ex-husband without knowing his income!” Rebell says. “While I now know that whom you marry is almost always the most important financial decision we will make, at the time, I was too timid to ask. What if he thought I was a gold digger? What if I didn’t like the number? Now I know that if you aren’t comfortable enough with your partner to get financially naked before you walk down the aisle, the honeymoon period will end before you know it. I am now happily married to a wonderful man who has always made me feel comfortable talking about money and who shares my financial values.” These eight tips will help you from fighting about money with your spouse.
Insisting on “the best”
“When my daughter was born, there was nothing more important to me than caring for her and keeping her safe. You’ve heard of crib strangulation, right? Yeah, me too. So I bought an expensive and—what I thought was a—highly durable crib,” recalls Brett Graff, family finance expert and editor of TheHomeEconomist.com. “I bought what the sales lady called ‘the Cadillac’ of strollers. I now know that all baby products undergo the same federal safety inspections and adhere to the same standards—and expensive cribs are recalled at the same rate as their cheaper counterparts. Know what’s a good investment? College savings accounts-529 savings plans. I should have bought bargains and taken the money I didn’t spend and socked it away.” Now, learn 56 almost effortless ways to save the most money.