We’re all guilty of financial slip ups, but not many of us will openly admit to these mistakes. A study done by Wells Fargo in 2013 revealed that 44% of Americans would rather discuss topics like politics and religion versus their own financial situation.
It’s no wonder that our nation is a state of financial instability and we're experiencing some of the highest levels of debt in our history. Here are nine of the most common money mistakes that everyone makes but no one talks about.
Source: Medic Madness
You probably know what a budget is, and may even understand the importance of creating one. But there’s a difference between creating a detailed budget and actually sticking to it every month. Ypu start off the month with good intentions of not spending too much money, but after a week or so, you’re back to overspending again. Doing this won't help you reach financial freedom.
Student loan debt is this generation’s financial downfall. Students, and parents, are relying on student loans more than ever to further their education, even to the point of crippling their long-term career success once they’ve graduated. It’s difficult to make any headway on your financial goals when you’re in an entry-level job with hundreds of dollars going to student loan payments every month.
Source: Engineer Your Finances
A rainy day fund is a basic necessity of getting ahead and properly managing your finances. Yet many of us, myself included, do not have the proper amount of funds saved up for emergencies. We’re just a few emergencies away from teetering on the edge of financial ruin and yet can’t seem to motivate ourselves to save for a rainy day.
From a new couch to car repairs, when a big purchases pops up we tend to make the mistake of financing them with credit cards. Too many of us view credit cards as an extension of our paychecks, and are often forced to use them to cover large expenses or fund other major purchases.
Source: Deseret News
Whether purposefully or by accident, you've probably been guilty of hiding money or purchases from your significant other. In fact, one in three couples are financially unfaithful to their partners. Various reasons include being ashamed of your spending habits or feeling like your partner won’t approved of your choices. Whatever the case may be, financial infidelity is a dangerous thing. It’s always better to be upfront and honest about your spending habits.
Retirement seems like such a far off goal and there are other seemingly more important financial goals happening right now. This makes it difficult for most individuals and families to prioritize saving for retirement. Many of us are still holding onto the hope that Social Security will be able to us, or some other form of government help. But this is a risky assumption.
Source: Office Sense
There’s always room to negotiate, but many of us view this as an old-school money-saving strategy. Cash is still king and can speak volumes to lowering the final price. Many retailers and department stores alike will give you a discount if you pay in all cash, or at the very least will usually match a competitor’s prices. But you have to ask in order to realize those savings.
I’m not sure why most of us back down from asking our bosses for a raise on a regular basis, but we do. There’s no harm in asking and hearing a “no” in return. Yet, we put off this conversation and end up missing out on thousands of dollars over our lifetimes. Newly graduated students are especially guilty of this and usually take the salary they’re offered without question.
Financial experts suggest that a mortgage or rent payment should make up less than 25% of your take-home pay in order to keep your bills within a reasonable range. This is wildly unachievable to most individuals who live in expensive cities, and must be compensated by sacrificing other areas of your budget in order to afford such expensive housing payments.
When it comes to money mistakes we're all guilty of them, so don't feel bad if you find yourself in a financial bind because you fell into one of these traps. There are ways to overcome these mistakes and get back on top. But the first step is to be honest and admit the money mistake in the first place.