Financial regrets plague even our most seasoned web professionals. Glean insights from their missteps.
Sometimes you gotta learn by doing, even if it means making mistakes in personal finance. Our experts at [our website] have their own regrets about past financial decisions – how they invested, where they kept their savings, and how they handled debt. But don't worry, you can learn from their experiences!
Ditch Low-Interest Bank Accounts, Opt for High-Yield Savings
Ana Staples, our credit cards principal writer, remembers her first savings account with a major bank, earning meager interest and charging hefty monthly fees. She regrets not switching to a high-yield savings account earlier, losing approximately $200 to $300 in fees and more in interest that she could have earned. Our tip is to not just stick with the savings account offered by the same bank as your checking account. Shop around, pay attention to rates, and avoid unnecessary fees.
Matthew Goldberg, our senior consumer banking reporter, boarded the high-yield savings train tardily. Estimating that not opening his first account until 2019 cost him between $500 and $2,000, he now earns interest each month and outpaces inflation, feeling good about his earnings every time he sees his monthly interest credited. Our tip is to consider high-yield savings accounts at FDIC-insured banks with no minimum balance requirements and no monthly service fees. Just make sure you're at an FDIC-insured bank, are within FDIC limits, and follow the FDIC's rules.
Contribute the Max to Your 401(k)
Benét Wilson, our lead credit cards writer, advises maxing out your employer-provided retirement plan, especially when provided with a company match. Failing to do so can cost you a significant amount, like $100,000 or more. If you're self-employed, consider a solo 401(k) as a retirement savings vehicle.
Establish and Separate Savings Goals
Karen Bennett, our senior deposits writer, advises setting clear savings goals and creating different buckets to save for each goal. This can prevent you from coming up short for any goal and achieving your savings more quickly. Our tip is to keep the money separate for each planned purchase or expense, preferably in a high-yield savings account.
Tap Credit Card Rewards, Especially for Free Travel
Katie Kelton, our senior credit cards writer, suggests snagging travel points instead of using cash back credit cards. This can lead to significant savings on free travel. Our tip is to research when to get the best welcome bonus and how to combine rewards for a higher value.
Make Index Funds a Part of Your Portfolio
James Royal, our principal investment writer, regrets not moving faster to invest in a strong stock index fund to avoid the volatility of individual stocks. Investing early can lead to millions in earned potential. Our tip is to start investing early, even with a small amount, into a low-cost index fund that tracks a broad market index like the S&P 500.
Always Compare Multiple Mortgage Lenders
Ted Rossman, a senior industry analyst, advises shopping around for multiple mortgage lenders. Applying to only one home loan company before closing meant he missed out on potential significant savings in interest.
Account for Secondary Costs of Homebuying
Lauren Nowacki, our senior loans writer, advises considering post-mortgage financial commitments like property tax increases and home maintenance when budgeting for a home purchase. These additional costs can add up quickly.
Consider Making Extra Mortgage Payments
Linda Bell, our senior home lending writer, wishes she and her husband had made more extra mortgage payments to lower their principal balance and save on interest charges. Our tip is to take advantage of high-income periods, tax refunds, or bonuses from work to make extra mortgage payments.
Diversify Your Income and Automate Your Savings
Denny Ceizyk, our senior loans writer and former mortgage loan originator, advises focusing on income diversification and cash-flow management to reduce reliance on loans. Our tip is to review your budget, shop for loans, and explore entrepreneurial opportunities to create additional income streams and maximize savings.
High-yield savings accounts offer higher interest rates, easy access to funds, safety, low or no fees, compounding interest, and are generally insured by the FDIC or NCUA. To find the best accounts, research interest rates, check fees and minimums, consider accessibility, evaluate bank reputation and insurance, read terms and conditions, and compare offers based on features and benefits.
- Ana Staples, our credit cards principal writer, recommends ditching low-interest bank accounts and opting for high-yield savings accounts to avoid losing substantial amounts in fees and interest.
- Benét Wilson, our lead credit cards writer, urges contributing the maximum to your 401(k), especially when offered a company match, to avoid losing significant amounts like $100,000 or more.
- Karen Bennett, our senior deposits writer, advises establishing and separating savings goals in different high-yield savings accounts to achieve savings more quickly and prevent coming up short for planned purchases or expenses.
- Katie Kelton, our senior credit cards writer, recommends utilizing travel points instead of cash back credit cards for significant savings on free travel by researching the best welcome bonuses and combining rewards for a higher value.
- James Royal, our principal investment writer, regrets not moving faster to invest in low-cost index funds, advocating for investing early to tap into millions in potential earned savings.
- Ted Rossman, a senior industry analyst, advises comparing multiple mortgage lenders to avoid missing out on potential significant savings in interest, recommending shopping around for the best offers based on features and benefits.
