2. Not saving for an emergency fund – If you are searching for financial advice, this one will always come up. Life is full of ups and downs, hopefully with a lot of fun and love in between. Yet, when the “downs” pop up like a health emergency or a car accident, you want to be ready. An emergency fund will give you security and not having to worry about the “downs” of life will be worth its weight in gold.
Are you having trouble saving for an emergency fund? Even if you can only put $10 out of every paycheck towards your emergency fund you will be better off. You will be prepared and relying on credit cards will be left in the past. If you save $10 per week for the next year, you will have $1040 at the end of the year. You just built yourself a mini-emergency fund. Congrats!
If you are really serious about setting up an emergency fund, I suggest finding a side hustle to earn extra money for a while. For some side hustle ideas check out these posts:
- Side Hustles: Ultimate List of 75 Ways to Earn Extra Money
- How I Earn Extra Money: 7 Best Survey Sites
- Pinecone Research Review
- 25 Ways to Earn Money Fast
3. Not saving for retirement – My great grandma lived to be two months shy of 100 and her daughter, my grandmother lived to be 91. Since longevity runs in my family, it would make sense for me to calculate this factor into my retirement plan. If the numbers are hard for you to calculate, sit down and discuss your retirement with a financial planner. You do not have to invest through them, but they can make some recommendations.
If you are young, you want to invest in stocks (more risky with time to recover if the market goes down) and the closer to retirement, move your money to safer options like money-market funds or bonds. Make sure you make a generous estimate of how much money you will need to pay your monthly bills at retirement (hopefully you will have paid off your mortgage, so it will be less than you are paying now) and calculate your estimated time to live (hard to say, but look at your family history). Then start saving!
Check to see if you will receive a pension and how much your social security will be. I recommend you sign up for a social security account online now because of all the security breaches lately. (What’s up Equifax??) You want that account to be in your name when you are ready to apply and not some thief that stole your information.