- Not taking advantage of a company 401k match.
This is literally free money and if you start young, with time and compound interest you could be throwing away what could one day be 100k+ in your retirement fund. If you are working for a company that matches, do what ever it takes in order to capitalize on this benefit.
- Using Credit Cards for your Wants instead of your Needs
Getting into Credit Card debt, as you may know, can be crippling and very hard to get out of. Spending on entertainment and alcohol via a credit card quickly can add up on you and ends up costing you A LOT more in the long run. Try and do everything possible to only use your credit card when you absolutely NEED to.
- Not having any sort of savings account
If you are just starting to pursue the path to financial freedom and are not in the greatest financial shape, a 6 month emergency fund may seem daunting. Don’t freak out at the thought of this, your goal for right now should be to build up to at least $1,000. If you don’t have some sort of a safety net, you can be forced into some really bad decisions when something goes wrong such as high interest payday loans.
- Living beyond your means
This is the worst thing you can possibly do and it simply means that you are spending more each month than you are bringing in. If you do not stop this habit now, you will soon find yourself in a lot of financial trouble with debt that you can almost never pay off. You MUST find a way to have a surplus of money each month to get on and stay on the path to financial freedom. If you find yourself in this endless cycle, below are some things you can to do achieve a budget surplus:
- Cut down on spending – get rid of the frills until your finances are in order.
- Get a second job to increase your income
- Pay off debt quickly
- Ask for a raise
- Not having a budget
If you do not have a budget, there is no way that you are making decisions with any sort of financial accuracy as to the impact your decisions are affecting your financial health. Sitting down and going over all of your bills and all of your excess spending can be an eye opening experience and is necessary if you are truly serious about having future financial freedom.