My Biggest Financial Mistake

 

Credit: http://sadlersbbqsales.com/investment-tips-roth-ira/

 

I’ve made plenty of money related mistakes in my life, but my biggest one is not investing in Roth IRAs every year. Or, at all. Don’t make the same mistake!!

In the majority of my jobs since college, I have made the point to invest enough in the company’s 401k to get the maximum matching contribution and have stayed long enough to become fully vested.  After two layoffs, I rolled over my 401k and pension into Traditional IRAs. However, I am guilty of cashing out two 401ks that didn’t have much in them. I regret not investing those funds into Roth IRAs.

My even greater regret is that my husband and I have not even attempted to invest in Roth IRAs annually, let alone make it a priority to deposit the maximum allowed each year. We are now in our early 40s and will be spending the remainder of our working years scrambling to make up for poor planning in our 20s and 30s.  I worry that our working years will stretch well into our 60s or longer.

My advice is that you start investing in Roth IRAs as early as possible, even if you can’t max them out each year. As your income grows, automatically put it towards them until you reach the maximum allowed each year. For rules, income limits, differences between Traditional and Roth IRAs and more, please refer to http://www.rothira.com/.

My husband and I are still paying off debt, but this year we will still each open an Roth IRA even if it’s only with $500 each.

This is a  serious case of do as I say, not as I do!

 

Share

Comments

My Biggest Financial Mistake7 Comments

  1. Thanks so much for sharing! I hope you have time to turn it around and save enough in the coming years. Saving for retirement scares me so much – I'm only 21! But I know I should start at some point. This is encouraging me to do so – thanks!

    • I'm so glad I provided some encouragement. The sooner you start, the less scary it will be. :)

  2. Pingback: The Roth IRA Movement

  3. It seems like many people these days are in a similar situation. After fighting with debt they suddenly realize that they haven't started saving nearly enough for retirement. At least you have recognized that mistake and are taking steps to get back on the right path. It's a lot better than the people who just keep on living in denial.

    • The important thing is that you recognize them. That's half the battle.