We all make mistakes, its part of growing. Even as we get older we are bound to make a misstep here or there. We simply can’t know it all, especially when it comes to our finances. Things change. Stock markets are cyclical, laws come and go, and each of our circumstances is subject to change. If you fail to keep on top of what’s going on, a seemingly smart financial move could prove to be a bad decision. Now, I don’t want to get into any personal detail, but by a show of hands how many people have made what you might consider to be a financial mistake? Okay, I appreciate your honesty. Avoiding financial blunders comes down to that one thing – honesty. We have to be honest with ourselves that we could do a better job with our money. We could all stand to learn more about managing our finances effectively. There are volumes of personal finance books available, and thousands of on-line resources to help us better understand our financial choices. Furthermore, we could all benefit by a conversation with a financial planner. Ultimately, we have to be honest with ourselves that it’s okay to ask for help when we are trying to reach a fiscal destination.
Listen, you’re not alone. Two thirds of Americans acknowledge making at least one really bad financial decision. More alarmingly, 47% of those people acknowledge making more than one bad decision. The median cost of that decision was $5000, but the average is $23,000. You don’t have to be a statistician to understand how important it is to make good financial choices. Today we’re going to discuss some of the common financial blunders people make. I’m going to tell you how they impact your life, and what you can do to recover.
Leading with your emotions is a tremendous financial blunder; one, which we are all guilty of at one time or another. When we make poor financial decisions we have to get beyond our initial thoughts to dig deeper into the impact of our choices. Our decisions are guided by intentions but derailed by emotions. Fear, and to some degree, the need for instant gratification have a tremendous influence over our financial lives. Taking command of our decisions requires sacrifice. Sacrifice requires commitment; and commitment means changing our behavior. This is a transformative process, which takes time. How do we change? That’s a broader subject we will address in succeeding videos. Contributions to this press release were provided by the Society for Financial Awareness.