5 Common Financial Mistakes
Mistakes are abundant. We’ve all made them! Mistakes with our money, though, might be among the scariest – so it’s worth getting to know some of the most common ones to try to avoid them.
In this latest installment of the Stuff About Money podcast, Erik Garcia, CFP®, BFA, and Xavier Angel, CFP®, ChFC, CLTC, chat about common financial mistakes – some they’ve made themselves! – one of those being forgetting how to count. They also briefly mention Xavier’s tie wearing habit, and Erik’s lack of one.
Episode Highlights:
- Xavier shares that living on borrowed money is one of the 5 common financial mistakes that people often make. (4:13)
- Erik and Xavier discuss the second common financial mistake, which is using savings to pay off debt. (10:33)
- Erik explains that having a little extra cash on the side, even if you have debt, will prevent you from going into further debt. (13:21)
- Erik discusses the third common financial mistake: accumulating something in 5 years that someone has accumulated in 30 years. (15:45)
- Xavier shares that people often make the fourth common financial mistake of not investing for retirement. (22:30)
- Xavier explains that it is important to start putting money away as early as possible for retirement. (25:11)
- Erik discusses the importance of developing the habits of saving and investing early in life. (28:53)
- Erik explains that If we genuinely think a certain identity is consistent with our identity, our behaviors will follow suit. (33:54)
- Erik and Xavier mention that the fifth common financial mistake is not having a plan for whatever you want to achieve for your future. (39:42)
Key Quotes:
- “There is a lot of research that supports this idea that when we believe a certain aspect about our identity, our behaviors are more going to be in line with that identity.” – Erik Garcia, CFP®, BFA
- “Here’s what I would say, even if you’re not saving 20% towards your retirement or 15% for your retirement, saving is a habit, investing is a habit.” – Erik Garcia, CFP®, BFA
- “You can put a little away today and begin saving and get into the habit of putting it away on a monthly basis into that retirement program. In next year revisit it, can you increase it? But the more you put away, the more that money you put away is going to make money for you.” – Xavier Angel, CFP®, ChFC, CLTC
