The 10 Most Common Financial Mistakes

Based on 35 years of experience, here are real life mistakes people make prior to coming to us.

1.  Not hiring a fee based financial planner

Not hiring a professional based on fees when the fee can be made back through strategy changes and improved returns.

2.  Misjudging or miscalculating risk

Many people don't know what risks they are taking with their investments. And, even when they do know, they frequently are not being compensated for the amount of risk they are taking.

3.  Making financial decisions on advice from friends

What works for one person may not work at all for another. Even beyond personal circumstances, the timing may just be wrong. For example, many people hear about last year's hot stock or mutual fund and invest, only to find the investment has peaked and they are now losing money.

4.  Doing nothing when confused

Many people are afraid to ask questions, fearing embarrassment. But, doing nothing produces mediocrity at best, financial disaster at worst.

5.  Putting taxes before returns

Tax liability is important, but it's not the only concern when you are trying to make money. For example, a typical taxpayer would come out ahead receiving a 8% pre-tax return verses a 2% after-tax return.

6.  Investing inappropriately

Individuals often do not allocate assets according to age and risk tolerance. Or, when their investments aren't performing, they don't know when to hold or sell.

7. Failing to consider financial goals

Many people are in a "spend as you go" lifestyle, failing to save for future events or protect their families from tragic circumstances. Time is money and delay only increases the chance of not being able to provide for yourself and your family as you would like.

8.  Trading too often

Many people have gotten hooked on watching individual stock prices and trying to "time the market." Unfortunately, even when they are lucky enough to pick a rising stock, the return is frequently wiped out by trading fees and taxes, not to mention the loses from other stocks that declined.

9.  Accumulating costly debt

A reasonable amount of debt is normal, even expected, in today's society. However, if you are locked into paying a large percentage of your income to serving that debt, it can prevent you from investing in your future or even catapult you into bankruptcy if unexpected troubles occur.

10.  Buying from a phone call or by mail solicitation

These products may not in your best interest. When your mother told you "if it looks to good to be true, it probably is," she was correct.

Don't let mistakes compound through inaction or procrastination

Many people put off financial planning until the the time comes to send their children to college or retire. Then, they find out that it's too late. Don't wait. Get started today. Contact us.