Your Money Journey: Lisa Sakai
Bad financial advice for women over 50 is everywhere and knowing what to ignore can be just as powerful as knowing what to follow.
Have you ever been given advice that just felt… wrong? Maybe you even followed it, only to find yourself in a worse spot than before. I’ve definitely been there. Early in my career, I received some truly awful advice about building a business and networking. It took me a while to unlearn those lessons and figure things out on my own.
That’s why I want to talk about bad financial advice. You might have received some of this when you were younger, or maybe you’re hearing it now. But it’s crucial to recognize these myths and understand why they can be so damaging.
5 Pieces Of Bad Financial Advice Women Over 50 Should Ignore:
1. The Myth Of Buy Now, Pay Later:
“Buy now, pay later” (BNPL) is everywhere. Furniture commercials promise 0% interest and no payments for months. It sounds amazing, right? You get that new couch you need without the immediate financial hit. BNPL options are increasingly common, even for smaller purchases on sites like Amazon and in stores like Walmart. It’s easy to sign up, and the temptation to make impulse buys is strong.
The problem with BNPL is that those small payments add up. You sign up for multiple plans, and suddenly you have a bunch of unexpected monthly expenses. It’s easy to forget about upcoming payments, especially when you have several different plans.
Before you know it, you’re spending hundreds of dollars a month on things you barely remember buying. This can strain your budget and even lead to credit card debt if you can’t keep up.
It’s essential to know where your money is going. BNPL can obscure your spending habits, making it difficult to manage your finances effectively.
I even fell victim to this once! I used a BNPL plan that broke a purchase into four payments. I completely forgot about the last payment and was caught off guard when it hit. Luckily, I had the money to cover it, but what if I hadn’t? What if that payment had caused me to miss a credit card payment?
2. The False Security Of A Minimal Emergency Fund:
You’ve probably heard the advice to minimize your cash holdings and invest, invest, invest. The idea is that cash is a waste and isn’t earning enough interest. While it’s true that you want your money to grow at least with inflation, having as little cash as possible can be a dangerous strategy.
What happens when an emergency strikes? If all your assets are tied up in stocks or real estate, how will you access cash quickly? Selling investments or borrowing against your home equity takes time. These aren’t fast processes. If you need money now, it can be difficult to get it.
Imagine your car breaks down, or you have an unexpected medical bill. Without an emergency fund, you might have to resort to high-interest loans or credit cards. That’s why you need a cash buffer for unexpected events. It can save a lot of stress and panic.
3. The Business Investment Trap:
Another common mistake is reinvesting all profits back into a business. While it’s important to invest in your company, pouring all your money back in can backfire. What if your business faces challenges or needs to be sold during a downturn? You might not get the return you were expecting.
Relying solely on your business for financial security can be risky. It’s important to diversify your investments to protect yourself from unexpected events.
4. Insurance: An Unnecessary Expense? Think Again!
Insurance is a crucial part of your financial plan. It acts as a buffer against unexpected events that could wipe you out. Having adequate coverage for essential assets and potential risks is essential. Insurance is not a waste of money if you invest in the right insurance.
5. Real Estate: A Guaranteed Win? Oops
Many people believe that real estate is always a great investment. They see prices going up and assume that they can’t lose money. But remember the 2008 financial crisis? Real estate values can decline. It’s important to consider all the costs associated with real estate, such as mortgage interest, property taxes, insurance, and maintenance. These costs can significantly impact your overall rate of return.
Be wary of advice from social media influencers who may be trying to sell real estate-related products or services. Conduct thorough research and seek professional advice before making any real estate decisions.
Does this mean you shouldn’t own a home? Absolutely not! Owning a home can be a great way to get to financial independence. However, just make sure you are minding this investment just like any other and don’t assume every real estate investment is a winner.
How To Spot Bad Financial Advice For Women Over 50, Trust Your Gut:
It’s important to be critical of the financial advice you receive. Trust your gut feeling when something doesn’t feel right. There’s a lot of bad financial advice out there, and it’s easy to get led astray.
Remember, there’s a difference between fear and a genuine bad gut feeling. Don’t let fear paralyze you, but don’t ignore your intuition either. I could tell you stories that would make your hair stand on end!
Note: Investment advice offered through Integrated Financial Partners, doing business as One Vision Retirement, a registered investment advisor. The information in this material is for general information only and is not intended to provide specific advice or recommendations for any individual. Integrated Financial Partners does not provide legal/tax advice or services. Please consult a qualified legal/tax advisor regarding your specific situation.
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About the Author:
Lisa Sakai is a Financial Consultant who works with clients on Bucket List Acceleration and getting to live the life they want now. As the co-founder of One Vision Retirement, she has been working with clients across the country for over 12 years. Lisa’s advice provides easy to understand, logical steps and exercises that people can take action on right away. Learn more about Lisa Sakai here at One Vision Retirement.
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