Personal Finance Mistakes People in Their 30s Make: Which Ones Are You Guilty Of?
Hold Excessive Credit Card Debt
Credit card companies may have you believe that it is the one-stop solution for all your monthly financial woes and even normalize your impulse purchases. However, accumulating too much credit card debt can be disastrous for your financial health, especially if you are making just enough to pay off the minimum mandated payment.
Not Discussing Financial Planning with Your Partner
Not having a sound financial plan before you take the big step of getting married is nothing but a recipe for disaster. You need to have an honest and open discussion about the current finances, accrued debt, budgeting, spending, and investments with your partner before you start living together.
Not Having Any Secondary Source of Income
Overdependence on your primary source of income can spell catastrophe for you and your family. That is why experts recommend diversifying your income through secondary sources–a side hustle or investments in mutual funds and equities.
Overspending on Luxuries / Unnecessary Lifestyle Expenses
Spending a significant chunk of your income paying rent to live your dream lifestyle will seriously compromise your remaining, equally important, expenses. This also includes overspending on cars, latest gadgets, and vacations—things for which proper budgeting should be factored in.
Not Prepared Enough for Contingencies
You need to plan for the worst. At some point in your life, there exists a possibility that you might fall sick or get hurt which could subsequently put you out of work for a prolonged period. Therefore, having a proper protection plan goes a long way in mitigating the crisis and keeping you out of debt traps.
Insufficient Investing in Insurances
Insurances can help alleviate your concerns in times of turmoil and provide a general level of security. Consult a trusted insurance advisor about good health, disability, and life insurance policies.
Put off Retirement Planning
Understandably, it might be hard for you to take retirement seriously since it always feels like it is too far into the future. However, it is never too early to start planning for your retirement and letting the advantage of compounding work wonders for you.
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