Mistakes I Have Avoided (And Hope You Will Too!)

After getting a sense of the mistakes I have made, I can now briefly touch some on some common mistakes I have been fortunate enough to avoid, and ones that I hope you are avoiding as well!

While I am sure I will get a lot of flak for my position on this issue, here it goes. To boil it down to a simple statement: If you don’t have the money in your account to pay in full, you simply can’t afford it. Now there are certainly exceptions to this, but if something is considered an exception, then this money needs to come from a separate emergency fund, an account that you DO NOT TOUCH except for, you guessed it, a real emergency. This would include unexpected events that you don’t see coming, such as a flat tire or emergency medical bills. (No, getting your hair done or going to WeFest are not examples of emergencies).

The most common mistakes I have heard or seen are listed below. These all fall under the general category of “Don’t Finance Anything!” (with the exception of a home).

• A “New” Car

Whether this is brand new or a “new to you” car, you should be looking at the total cost, and not the cost per month! Right now I drive a 2010 Toyota Camry with close to 200,000 miles on it, with a passenger door that doesn’t open from the outside. It was totaled after I was T-boned a few summers ago. I was given two options by the insurance company: get a $5,000 check and they take my vehicle, or $3,000 and I get to keep the car. You can probably guess what I did.

My parents were also recently offering to sell me their car, a nice 2011 camry with many less miles on it, and I turned them down. Not because it wasn’t a fair offer, but because I thought through the cost implications of this move and realized I had bigger goals than driving an updated car. More on this here.

• Phone

If it still works, why do you really need the newest one? I still have an iPhone 7, which is coming up on its four year anniversary in the Fall of 2020. Actionable Tip: When you get your phone, go on eBay and order a couple of sturdy cases and a pack of tempered glass screen protectors. You can find packs of three of these shatterproof protectors for easily under $10, and one of these has saved replacing my screen literally hundreds of times.

• Furniture

Have you heard of cleaning supplies & Craigslist? Febreze & Facebook Marketplace?

• Boat

I need to look into this one a little bit more, but again, a simple Craigslist search can yield some amazing results. Again, this is a direct dig at a couple of my buddies, of whom I take advantage of their boating ability, so I won’t touch this one with as much intensity. All I am saying is that there is probably a better way to go about getting one of these bad boys in your hands. Do you really need 500 horsepower for your fishing boat, where all you will do is drink on the lake and enjoy the sun anyways?

• TV’s, Computers and Gaming Consoles (Technology In General)

Wait for Black Friday or a sale. Do some research beforehand. The first deal you spot likely can be beaten with a couple more google searches. The extra 10 minutes of window shopping might save you hundreds. Try Groupon! I still have my 2013 Macbook Air from college and I have found the same model for a few hundred dollars. Also, last time I checked, used TV’s work just as well as brand new ones…..

• Home Renovations

Let me be clear, I am not referring to necessary repairs, like a leak or roofing damage. I’m talking about the appliances that work just fine. Your fridge still keeps things cold, do you really need the one with a TV screen in it?

• Engagement Rings

Again I will probably get a lot of backlash on this one, but if your significant other is making backhanded comments, or worse, threats about your relationship status based on the size of a mineral on a ring, there may be other aspects of your relationship to discuss. This might speak bigger volumes about who they are as a person.

There are a million more mistakes people can make with their money, but by cutting these out of your life, your chances of financial freedom are so much easier to picture. Take care of these, and the smaller details will fall in line.

#lifestyle #decisionmaking