Everyone makes mistakes in life. Some of them are minor, like forgetting your lunch, and others embarrassing, maybe calling someone the wrong name. And then there are other big ones: making a bad investment or a poor financial decision. But in my experience, people come to us who have made some excellent financial decisions and some poor financial decisions. I understand that you might feel some regret and embarrassment over past mistakes, but we’re not here to focus on them. What one needs to do is learn from the mistake and then move forward with their new experience.
But it’s also important to try to predict certain decisions and their effects on your financial plans. What might seem like a good decision can actually have negative effects on your finances. For instance, society tells us to live a debt-free life, but sometimes having debt is a good thing — especially if it frees up cash flow to make better financial decisions and provide more cash flow.
The effect of financial choices regarding cash flow, debt, taxes, insurance, estate planning, investing, and other financial aspects of one’s life is much more complicated than that. Making the wrong choices can ensure that you work longer in life, leave you with less wealth and cash flow, or increase the risk in your investment portfolio. But what’s important is that when a poor decision has been made is not to dwell on it, but to learn from it and move forward on your financial journey.
For more information on how to learn from past financial mistakes, visit tswealth.com.