Workplace benefits may reflect new reality of Covid Perhaps you risked some of your security in retirement to make your dream of owning a house come true, but when you watch your daughter reading in the living room, no other path seems imaginable. Many of our financial decisions leave us with both measurable and immeasurable rewards and consequences.
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And that messy reality can make it hard to know what "the best" money moves are. To help with that, CNBC recently spoke to financial advisors about the most avoidable blunders they see their clients make.
Here are some of them.
Living beyond their means It's common for people to spend in a way that leaves them how to make the biggest money down the line, said Barry Korba certified financial planner and the president of Lighthouse Financial Planning in Potomac, Maryland. Recently, Korb found it difficult to persuade a retired couple to trim their overhead.
One major expense was their house, which had a wood working workshop.
He recommends people try to be more patient and flexible with their desires. Korb said repeatedly defining and revisiting your goals can help you to stay motivated. Ignoring taxes "Tax planning is an easy way to save money if you understand the tax laws, and there are many ways to do it," said Brad Bobba certified financial planner and the owner of Bobb Financial in Springfield, Illinois.
Yet many people don't think about taxes.
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They find the rules daunting, or they don't want to spend the time to learn and understand them, Bobb said. If you're overwhelmed, one simple way to get started is to find out how your different investments and accounts are taxed, Bobb said: "It's something the average person needs to spend some time educating themselves on.
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Some people will want to turn to a professional. You can always hire an advisor for a few hours and have them teach you about tax strategies and how you should implement them. Some of the most common ways that people can save money with taxes is through charitable giving and tax-loss harvestingin which you sell losing assets to offset taxable capital gains.
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Meanwhile, Bobb called Health Savings Accountsin which you put away pre-tax income that can later be used on certain medical expenses, as "the most underutilized retirement savings vehicle. Sometimes a stock was inherited from a family member, Curtis said, and the client can't bring themselves to sell it.
To prove her point, sometimes she shows a client a list of once great stocks that no longer exist. Some examples: Blockbuster, Kodak, Pets. Related Tags.