Where you are at today financially is a combination of all the financial decisions you’ve made up to this point in your life. Most people have never been taught about finances; furthermore, very few have had any type of financial coaching. Money has been something we just learned about along the way. Sometimes that learning experience becomes very costly because of the lack of knowledge or poor planning we often do before making a financial decision. I will be the first to admit that I have made my share of financial mistakes. Some mistakes were extremely painful, while other mistakes were not so painful. I was thinking, what if one could eliminate the majority of bad financial decisions in the first place? Wouldn’t that make life a whole lot easier?
Here are some quick strategies you can use to reduce your odds of making financial mistakes.
Learn from Others
Curiosity is a good thing. Read about successful people. Successful people have their share of failures along the way as well. It is simply the price you pay to become successful. Billionaire Real Estate Builder Donald Trump sums it up by saying, “Always try to learn from other people’s mistakes, not your own- it is much cheaper that way!”
There is so much information out there about the mistakes people have made; open your eyes to them. Become curious and study their mistakes so that you can avoid them all together.
Become a Detective
To reduce your odds even further from financial mistakes, gather as much information as possible about your future financial decisions. Knowledge is power. I love this quote by publisher Charles Knight. “Every mistake that I made – and we all make mistakes – came because I didn’t take the time to get the facts. I didn’t drive hard enough.”
Today, when I am making any type of financial decision, I research everything about that financial matter. I don’t want to go into it blindly. I want to understand everything about it. I want to know all the details and costs involved. Gathering all the information is key. It is very important to do as much investigative work as possible to reduce the odds of making another financial error.
Have a Plan
Very few people have a Financial Plan in place. Money is so important in our lives, but the masses brush it under the rug. Do the opposite; get a plan in place. Take things in small steps instead of trying to take a giant leap. If you make smaller financial choices along the way, you are reducing your risk. Financial Planning is very simple; it is not rock science. To get started, have the following:
– A monthly budget
– An emergency fund
– A retirement savings plan
– Adequate amounts of insurance
– And create a debt reduction plan
If you start focusing on these areas of financial planning, you will eliminate the majority of financial mistakes people are making out there.
Put the odds in your favor and keep more money for yourself by learning from others’ mistakes, gathering the details, and putting a financial plan in place. This way, you will eliminate the majority of financial errors you could make and you will be able to enjoy more fruits of your labor.