Have you ever sat down and thought back to some decision you made that seemed appropriate at the time but turned out to be a less than stellar move? I sure have, for example when I bought a used car too quickly without even negotiating the price (hey, I was young and needed some wheels pronto). Well, here are some other dumb money moves.
- Not having a budget. Establishing a budget helps you control spending and avoid that “Where did the money go?” feeling. There are web sites which offer free budgeting help. UKFCU sponsors one here
- Buying a new item when the old one still fulfills your needs. Electronic device Generation 25 anyone? Why spend more for the new one just because it’s available if the one you already have works just fine. Do you really need to create holographic 3d images to show you vacation videos?
- Failing to save for retirement. If you start early you’ll end up with much, much more due to the power of compounding and the long term market outlook. Start late and you’ll find it hard to catch up before retirement age arrives.
- Turning down free money. If your company offers a 401k option in which they match your contributions up to a certain percent (it may vary but typically, 50% to 100% of the first 6% of your income you contribute), join as soon as you can. If you can’t put in 6%, start with 3% and increase the amount by 1% every year until you reach the company match maximum. Since it’s pre-tax dollars, you won’t miss it.
- Not protecting your good credit. Many financial institutions charge more for loans if you have low credit scores, so keep your spending reasonable and pay your bills on time.
For more planning tools from UKFCU, click here