Money is tricky, and some would argue our generation is the worst at it.
A new report came out recently by the FINRA Investor Education Foundation that broke down American's money habits now, compared with data from 2009 and 2012. Here's the good news: We're getting better at handling debt and saving up for short-term goals. Here's the bad news: There are the three major money mistakes people are still making.
I was definitely making these mistakes until I read an eye-opening book about personal finance called "I Will Teach You To Be Rich," by Ramit Sethi. I know the title sounds cheesy, but before reading that one book, I didn't even know what a credit score was.
But if you're too lazy to read a whole book about how to handle your money, here are the three biggest mistakes people are still making with their hard earned cash.
Try to avoid these, OK?
1. We're still screwing up with credit cards.
According to the report, 32 percent of consumers are still just paying the minimum amount due on credit cards and carrying a balance. This is bad. Ideally, you'd carry no balance on your credit card month to month and pay it off every time, on time.
And if you have credit card debt, you should always be working toward paying it down. The longer you carry a balance, the worse your credit score will be. And if your credit score is bad, you're basically fucked.
It's not all bad, though. The numbers in terms of credit card payments have improved all around since 2009, meaning we've gotten better with money. But, don't pat yourself on the back just yet.
2. We're not living below our means.
If you want to save money, you need to spend less than you make. Apparently, 18 percent of consumers spend more than they bring home. Not good. You're always going to feel broke if you overspend, people.
In 2009, 35 percent of consumers spent about the same as much as they made. This percentage is now at 38 percent. Also, now 40 percent are spending less than they make compared to 42 percent in 2009.
So, these numbers show we aren't doing well when it comes to watching our spending and living below our means. Maybe it's time for some of us to take a good hard look at our credit card statements instead of guessing how much we spend per month.
3. We're ignoring the fact retirement is a thing to save up for.
According to the survey, only 39 percent of consumers crunched the numbers on how much they needed to save for retirement. And that part is fairly easy. You can do it from your bed. It really doesn't take long compared to how much time it takes to actually save up the money for retirement.
OK, this really makes me upset. Isn't saving up money for when we stop working part of the reason we grind it out for so many years? I don't understand why people are still not thinking ahead. If you already have a 401(k), IRA or some kind of retirement fund now, you're definitely going to thank yourself in the future. If you don't, set one up ASAP.
You'll need (and want) way more than you think, so start saving early, people. The good news is, according to the survey, consumers are getting better at saving for short-term goals like vacations, emergency funds and college. But what about after all that when you're too old for vacations?
So, there you have it. If you're making just one or even all three of these major mistakes, there are things you can do today to improve your money situation.