Do you want to reach financial success?
The first step is getting your mind right!
Being in this business for over 12 years and interacting with all different types of people, I have heard some crazy financial advice along the way.
I wanted to share with you 10 of the wildest things I have heard and my responses…
The Worst Financial Advice
10 Things
- I will wait till next year because it will be a better year to invest.
- How do you know for sure? It’s impossible to time the market. It’s better to build the proper portfolio today and monitor it along the way.
- No one should keep an emergency fund, that’s what a credit card is for.
- Unfortunately, credit cards charge interest. So, that little emergency can grow into a very large financial problem if you can’t pay it off. It’s ok to have a credit card, but you should have money in the bank too.
- I am going to buy just one stock and hope it hits big!
- More “sure things” go belly up, than hit home runs. It’s ok to have some side investments, but the core of your portfolio needs to be diversified. Your future is too important to gamble on 1 stock.
- I will use my life insurance policy for everything.
- Life insurance has a place in a financial plan, but it’s not the end all, be all, for everything. It’s very hard to continue to make premium payments long enough to reap the rewards. You have to diversify your financial strategies to accomplish all of your financial goals.
- I didn’t sign up for my work disability insurance because I never get sick.
- All it takes is 1 time… Employer sponsored disability is usually cheap. Buy enough to protect yourself and your family. If you protect your house and your car and your stuff, you should protect your income too.
- I am going to leave my beneficiaries blank because I know the government will take care of it.
- This is the worst kind of estate planning. It could have tax ramifications or the wrong people might get your stuff. Do the proper planning and get your affairs in order.
- I’m too young to start saving for retirement I have so many years to go.
- This is the most common and the most dangerous comment I hear all the time. When you’re young, time is your best friend. It allows you to use small dollars to make big dollars. Learn about compound interest here.
- I’m not doing any planning because I will just inherit my parents money.
- What if they end up using all of it in their retirement to live or for medical care? Inheritances are great but can never be planned for.
- I only want guaranteed investments
- The problem with this is a thing called inflation. In the stock market you are rewarded for taking risk in your portfolio. One of the rewards is staying ahead of inflation. It’s great if on paper your portfolio never goes down, but if everything around you is becoming more expensive, you are still losing.
- I am very good at managing my money because I pay all my bills on time.
- Paying bills is not doing financial planning. The art of financial planning is preparing for the future… bills are all about today.
It’s possible you have thought or even said some of these items. It’s never too late to change your thinking and get your mind right. You an experience financial success if you get out of your own way!
As always, you can consult with me to discuss your current situation!
Look for future posts on financial planning and check out my recent post Checking in With Your Portfolio.
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Thanks for stopping by and I hope you achieve financial success!
