7 ways you could be setting yourself up for financial disaster

[FarCenter]

...

And while most people would never consider committing harakiri by any means, there are more than a few folks who unwittingly choose to commit financial suicide every day.

How so? Well, here are seven of the most popular methods:


1. Having children too early

2. Abusing credit cards

3. Maintaining financial dependency on others

4. Failing to accurately track income and expenses

5. Setting down roots in the wrong location

6. Failing to establish a plan for the future

7. Marrying the wrong person

http://www.businessinsider.com/7-ways-you-could-be-setting-yourself-up-for-financial-disaster-2017-1

[safeinOhio]

1. #7 set me back.

2 year marriage and a 3 year divorce to follow. Never marry a cop..

[Tikki]

2. I disagree with #1, but totally agree with #5

#1 depends on the parents' priorities.


Tikki

[bettyellen]

6. Mostly applies to women. Biggest percentage of folks in poverty babies and their single moms.

[2naSalit]

3. #7 exacerbated by #5 got me.

[scscholar]

4. Too early?

Those things are always expensive.

[bhikkhu]

5. 2, 4 and six got me when I was younger

Then 7 took care of my middle years.

Perhaps I've put down roots in the wrong place now, but that's a hard one to know for sure.

[mercuryblues]

7. I thought for sure

#1 was going to be...voting republican

[haele]

8. Looks like a typical blaiming the victim list.

The only way to avoid "financial suicide" as identified above is to be born a trust fund baby with an army of accountants and a lavish allowance to be able to offset any of the above financial mistakes.
Heck, four of the issues listed are pretty near unknowable.
Most people can't know at the time if they're having kids too early, setting down roots in the wrong location, failing to establish the correct plan for their future, or if they're marrying the wrong person. While there may be a certain amount of risk supposition that can be made at the time a choice is made, you can only take responsibility for the future if you can fairly accurately surmise the future. If you recklessly ignore a risk, that's one thing. But if everything looks good - you got your job started, you met someone who seems to be a on the up and up as well as being a good partner, if it seems as if you've got a good plan for a distant future working in your career - one can't be expected to make work the only focus of life until the 401K/Roth is sitting near $1mil - and then look to start a family - a spouse, kids, a home of your own.

This author's Financial Suicide = not having enough money invested or insurance available to cover any situation. Which basically means one has to be rich, or take responsibility for the "poor choices" of being born to the wrong family or having the wrong temperament, educational background, emotional bonds, or career choice. Or maybe the poor choice of suffering through some bad luck.

Haele

[Runningdawg]

9. I'm going to add one

NOT using credit.
I am 57 years old. I have bought 2 homes with cash, several cars and a few more large ticket items. I have money in savings, a checking account with the same bank for over 30 years that has never been overdrawn and don't owe a red cent to anyone. Yet, I was just turned down for a loan for a new furnace. When pressed, the loan officers (I tried several places) told me it was because I had no credit history.
A few years ago I applied for a pt.time job stocking store shelves overnight. I have 2 college degrees and experience in the field. Yet I was turned down and when I asked why I was told I could not pass the credit check included in the background check. I told them something must be wrong, I don't owe anything to anyone. I was then told by the human resource manager only poor people did not have credit cards and poor people steal.
Moral - you will be penalized much more for not using credit than abusing it.

[roamer65]

16. That's true.

The fastest way to rebuild damaged or to build new credit is to have 2 credit cards and run a small balance on only one of them. About 10 percent of the credit limit. It shows a reliable payment history. That's the gateway to affordable car loans and mortgages.

[MindPilot]

10. Don't get married, have kids, buy a house or go into debt.

Those are all things that people are pressured into by our culture, usually too early in life and without completely understanding the consequences. Any one of them can seriously mess up your financial life, combining them is almost guaranteed disaster.

[smirkymonkey]

11. Another one...

Student loans - there is no escaping them and if you have a setback or become unemployed or under-employed, you are just out of luck. That interest keeps accruing whether you can pay it or not.

[FarCenter]

14. That's a great number 8.

[tenderfoot]

12. Setting down roots in the wrong location...

LOL!



Spare me.

[FarCenter]

15. This also seems to go with "marrying the wrong person"

Especially when young women follow the wrong man.

[HeartachesNhangovers]

13. Although I don't have kids, I would

amend #1 to be: "Having children before you are financially stable". Raising kids takes a lot of energy, so I would think you would want to do it as young as you can responsibly do it.

Some of the others seem pretty obvious, but my wife's cousin, who always had trouble saving, finally started keeping track and found that his daily retail coffee habit was costing him $300 (!) a month. Now he makes his own at home.