When looking to achieve financial success, money mistakes can be derailing. These can include taking on too much credit card debt and not saving enough for retirement.
According to a recent survey by financial services firm Edward Jones, 79 percent of Americans have committed a financial mistake. The most prevalent misstep was inadequate retirement savings, made by 26 percent of respondents, followed by poor tracking of spending and taking on too much debt.
“When it comes to long-term savings goals like retirement or education expenses, we cannot stress enough that taking an early and managed approach is the best way to tackle the process,” said Scott Thoma, investment strategist for Edward Jones .
Thoma added that people who don’t pay enough attention to their expenses could save money by simply making coffee at home each morning and putting that money into a savings account.
While these are some of the most common financial mistakes, there are many others that could be hurting consumers.
Taking out a loan for items that decline in value – Oftentimes, people borrow money to pay for items that lose value. While many people making a big investment, such as buying a car, have trouble affording the purchase without a loan, others take out a loan for items such as appliances and electronics, which should be avoided, as these products lose value fast.
Buying a new car – Although it may make them feel good about themselves, buying a new car isn’t always financially responsible. As soon as vehicles are driven off the lot, they can lose up to 25 percent of value. With that said, it could be a better idea to purchase a lightly used vehicle, as this will depreciate much slower.
Not having an emergency fund – Everyone is faced with unexpected expenses, such as a trip to the hospital or a car repair, but many aren’t prepared. To help in these situations, people may want to have an emergency fund. This is an account with money that isn’t touched unless a surprise expense presents itself.
Ignoring your credit score – To be financially successful, people need to pay close attention to their credit scores, however, these are often neglected. Consumers are entitled to a free credit report from each of the three major bureaus each year, so they should take advantage of this benefit.
People who are committing money mistakes might want to contact credit counseling services to help them get back on track.