Making money mistakes may seem like the end of the world and I’m not going to lie, making mistakes in our 30s can have long term effects on our financial well being for years to come. However at the same time there is no financial mistake that I’ve come across that people can’t recover from.
Instead of making mistakes, trying to recover from them, learning your lesson, changing your habits and taking action to avoid making the same mistakes again, why not just avoid making mistakes all together. Sometimes that’s not possible if we never learn the dos and don’ts of money management. However talking to professionals can help us learn how to use money wisely and avoid making common money mistakes.
Here are four money makes we make in our 30s:
Overspend because you have money
Our 30s are a turning point in our financial lives. It’s the time when we grow up, possibly advance in our full time jobs with higher salaries and most likely have paid off our student loans. These things all sound like positive financial milestones, but the truth is they can lead to a common financial mistake.
When you life starts to get a little bit better with less debt and more income the temptation to spend can arise. Just remember to always spend within your limits and avoid using credit cards so you don’t get into debt.
Buying an expensive house
A lot of people buy their first home in their 30s and end up being house poor because they can’t afford the mortgage payments. This is a huge financial mistake.
It’s nice to have a home that you love, but not at the expense of your lifestyle. Your first home is a starter home and shouldn’t break the bank. No one is saying that buying a home isn’t expensive, but it shouldn’t put you in the poor house. Compromise on some amenities and be willing to give us some “must haves” in order to find a more affordable first home.
Accepting every credit card offer
This is a big money mistake and the one that landed me tens of thousands of dollars in debt. Having more than one credit card is unnecessary because no one needs a wallet full of plastic. Some people think that being approved for credit is a sign of maturity, but accepting credit offers and racking up debt you can’t afford to pay off is truly a sign of immaturity.
Avoiding your retirement savings
The truth is the sooner you start saving for retirement the sooner you can retire or the more money you’ll have to live off in retirement. Of course when we’re in our 30s we have other goals like traveling, buying a home and starting a family; but no one says you can’t have more than one goal.
Prioritizing multiple goals will help you determine how much you should save towards each. The closest goal should get your financial focus. Even though retirement is far away contributing consistently will help your savings build up over time.