Money Monday: The Biggest Money Mistakes We Make in Our 20s, 30s, and 40s
With age comes wisdom, but when it comes to finances, it's best to have as big of a heads up as we can! Whether you're just starting out own your own and fearful of, or struggling with, the financial stress that independence brings, or you're long past that point and still not quite comfortable with your money matters, it's never too early - or late - to take control of your finances!
In Our 20s
Ignoring Student Loan Debt
Once we graduate, there are so many monthly bills to worry about that are probably entirely new to us. Rent, utilities, and car payments seem simple and straightforward enough to understand, but student loans - and all the repayment options - seem a little tricky, so we push them aside as long as possible. It's a smarter move to start paying off your student loans as early as possible - long before the six month grace period is over. You can even start paying them while you're still in school, but if you can't, then as soon as you receive your diploma, investigate the repayment option that best suits you and start paying them off the minute you can.
Being Afraid of Investing
The world of investing sounds scary and complicated. Even more difficult to make sense of than student loans! Plus, it's assumed that we need a lot of money to invest it - which isn't true. Call up your financial institution and ask them about investments. They'll likely have a team member that can sit down with you and make sense of it all - and get things started for you. Sites like Investopedia help you break it down with helpful articles, videos, and tools, too! | Find out more about Investments at 3Rivers.
Not Learning About Finances
Who are we kidding, anything and everything financially-related seems scary and complicated! But being proactive in educating yourself and taking control of your money matters now is key to keeping on top of them years from now. Financial literacy is available on all kinds of platforms - online, at your financial institution, in seminars and college courses - you just have to seek it out. Take the first step, you'll be so, so glad you did.
In Our 30s
Buying More House Than We Can Afford
The average homeowner lives in a location for about 7 years before moving, and will move about 11.7 times throughout his or her life. Needless to say, your first home likely won't be your last, so don't go all out. Keep in mind, situations will change - your family may grow, you might be relocated for work, and so on - so don't put money down on what you think might be your dream home from the get-go. Start small and work your way up.
Competing With Peers + Colleagues
It's easy in our 30s, once we've settled into our careers, relationships, and homes, to start questioning whether or not we're "keeping up with the Joneses." We start comparing our situations and successes - or failures - to those around us. This can lead to some major money issues if we begin to improve our lifestyle - our home, our car, our wardrobe, our vacations - based on how we think we should be living because of these comparisons. Instead, we need to learn to evaluate and improve ourselves based on our own life goals.
In Our 40s
Thinking It's Too Late to Start Saving for Retirement
Sure, we can't go back in time and make up for not saving for retirement in our 20s and 30s, but it is not too late to start saving now. Besides, many people hit their financial stride - as we're making more than we ever have and have already paid off many debts. Invest in your company's 401(k) or start an IRA now - you've still got about 20 years before retirement - and you might be eligible for 'catch-up contributions' later on.
Thinking We're Too Old to Switch Careers
Although many of us know deep down that we're not in the career field that we're truly passionate about, the fear of a salary cut or instability in leaving a job for something entirely different, especially since we're not fresh out of college - holds us back. Shifting your focus doesn't mean you have to start from the ground up again. Highlight the experiences you do have in the field you wish to pursue and you might be surprised at how high up you can start. It all starts with taking the plunge - you'll never know if you don't try.