Tips To Avoid Financial Pitfalls - KTEN.com - No One Gets You Closer

Tips To Avoid Financial Pitfalls

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We're looking out for your money on Good Morning Texoma.

A money slump may be lurking around the corner! Did you know,  April is Financial Literacy Month- a month set aside to fight off that slump and get back on track with our money!

Financial professional Scott Maxwell from Talis Advisors joined Lisanne with some tips for people of every age.

 

Q: With April being Financial Literacy Month, it's important to note that people have a lot to learn when it comes to money...

 

That's right- an overwhelming majority of people (80%) say the worst decisions they made involved finances. That means money mistakes rank higher than miscues involving their marriage, health or job (according to the National Foundation for Credit Counseling). If there's any silver lining, it's that people at least recognize and admit they are making financial mistakes.

 

Q: The financial mistakes we make depend a lot on our age. What are the biggest financial mistakes people in each age group are making?

 

In your 20s - Student loan debt

Let's start with people in their 20s. They are taking on too much student loan debt. 7 out of 10 college grads have debt, with an average amount nearly $30,000 (according to the Institute for College Access & Success). You could be paying that back into your retirement! I get it, college is expensive, but look for ways to cut the cost. Apply for every scholarship you can, and consider a less expensive college, or maybe a couple years at a junior college.

 

In your 30s - House poor

More and more people in their 30s are what's called house poor. They're getting lured by low-interest loans into buying houses that are more than they can afford. Your first home will likely not be your dream home. Make sure you're not stretching your budget so tightly that you can't afford to save for college or build an emergency fund.

 

In your 40s - Credit card debt

Credit card debt puts a huge drain on your finances. Imagine how far your money could go if you can eliminate paying 19% interest on your balance each month. I recommend my clients start by attacking the card with the smallest balance, and then work up to your larger balances. You'll feel good every time you can cut up a card, and that momentum will help you accomplish your goals.

 

In your 50s - Raiding retirement funds

I see a lot of people making a big mistake in their 50s. They dip into their retirement savings to help out their adult children, or perhaps to support aging parents. I know you want to help out your family, but consider this: you don't want your children to have to take care of you down the road.

 

In your 60s - Not maximizing Social Security

Many people think claiming Social Security is a simple decision- you retire and you start your benefits. But there are actually hundreds of different combinations of how and when you can elect your Social Security benefits, and the decision will greatly impact how much money you will receive. To learn more about some of these strategies, go to my website at talisadvisors.com