The most common money mistakes

The most common money mistakes

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If a random person were to take a look at my list of New Year’s resolutions for 2023, they would probably say that I set the least sexy resolutions of all time. While some resolution lists might consist of exercising more consistently, eating more fruits and vegetables, getting better sleep, traveling more, or even drastic life changes like getting engaged or getting a new job, my resolution list features just one. goal: find out what the hell is going on with my personal finances. From building an emergency fund to investing and paying off debt, I want to learn it all, and despite its lack of appeal, I know I’m not the only one with financial self-care at the top of my game by 2023 ( hello, recession!).

Enter: Tori Dunlap, personal finance guru, founder of Her First $100K, and author of The financial feminist. This week on The Everygirl Podcast, we sat down with Tori to discuss all things personal finance, and she shared an incredible perspective on what it really means to change your relationship with money for the better. Whether she’s starting a new financial self-care journey this January, or just curious about new personal finance hacks, Tori has a wealth of knowledge (pun intended). Ella read on to learn three common personal financial traps she says women commit most often and how to avoid them. Then check out this week’s episode of The Everygirl Podcast to find out more.

1. Tackle the numbers before analyzing your money mindset

Tori found that while many clients were initially excited to learn about budgeting, investing, and paying off debt, that enthusiasm faded over time if they didn’t take a hard look at their relationships with money first. “I realized that even if it is very uncomfortable, you cannot be good with money, you cannot develop a good and healthy relationship with money for the rest of your life, until you begin to understand what kind of emotional and psychological complexes you over the money,” Tori said. One journaling exercise Tori recommends before diving into the numbers is to reflect on his first money memory and think about how that memory has impacted his financial habits today. Exercises like these can set you up for success on your financial journey even before you create a budget.

2. Overthinking financial decisions or having “analysis paralysis”

Have you ever had a moment where you know you want to cook a healthy meal at home, but you’re so indecisive about what to cook that you end up eating pizza at 9 pm? If so, he’s familiar with the feeling of analysis paralysis, which Tori says is a very common financial problem that gets in the way of reaching our personal financial goals. Many people stress too much and for too long to find the better high-yield savings account for your emergency fund, the better investment plan, or better credit card. Actually, starting to save, invest or build credit is much more important for financial growth than finding the best options. Tori’s advice is to start as soon as possible. She knows that the differences between many of these accounts or plans are minimal, and the best thing you can do for yourself is to pick one and run with it.

3. Succumbing to investment phobia

If you’re like me, hearing the word “invest” can send a shiver down your spine as you experience terrifying memories of your seventh grade math class when everyone except you understood the unity of the stock market. However, as Tori points out, investing in real life should not be feared. In fact, it’s an incredibly useful tool for financial self-care. Imagine yourself at retirement age: when you’re 65, what do you want to be like? What do you want to spend your days doing? According to Tori, investing (especially through a 401K or Roth IRA) is the same as taking good care of that 65-year-old version of you. “You’re doing it for yourself, and you’re going to spend this money eventually,” Tori says on The Everygirl Podcast. “It’s for you, 65, to splurge on sauvignon blanc with lunch.”

Avoiding paralyzing investment terror may mean thinking a little harder about why investing will be good for you in the long run, and why saving that money for now will be worth it. A little heavy lifting in 2023 through reversal can make all the difference in 2043, 2053, or 2063.

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