They say that luck is when preparation meets opportunity. If you’re always prepared, then, wouldn’t it make sense that you’d always have good luck?
This Friday the 13th, as you’re busy dodging black cats and walking under any ladders, you can take some simple steps to make sure your financial luck holds up, even under the unluckiest of circumstances.
Here are 13 money disasters to avoid this Friday (and every day):
Everybody spends too much money from time to time—some of us more often than others. It’s a bad habit, but with a more disciplined approach, it can be avoided. Start by creating a budget, and sticking to it.
It’s easy to get started. Check out our guide to building a simple budget.
2. Scoffing at saving
You’ve heard it before, but here it is again: You need an emergency fund. This is probably the single most effective way to ward off financial disaster—have some money set aside for emergencies, whether it’s an unexpected job loss or a medical emergency.
Learn how to create an emergency fund, and figure out how much you need to stash away for a rainy day.
3. Letting inflation eat up your paycheck
Inflation refers to the rising cost of living over time. Basically, it’s the tendency for goods and services to get more expensive—and as a result, your money’s value erodes with time. And lately, it’s been eroding at faster and faster rates.
What can you do about it? Invest it, rather than hiding it under a mattress or sticking it in a checking account. If historical trends tell us anything, it’s that your returns should outpace the rate of inflation.
You can start investing with only $5 with Stash.
4. Trying to beat or time the market
If you’re already investing, then you’re on the right track. But once your money is in the markets, you’ll be tempted to outsmart or time the markets.
While there’s a possibility that you’ll be successful, almost every financial expert will tell you that it’s a bad idea. Your best bet, instead, is to take a “set it and forget it” approach to investing. Buy securities and hold them.
Still, aren’t convinced? Research shows that less than 1% of professional investors were able to beat the market. As a beginner, the odds are probably stacked even higher against you.
5. Obsessing about day-to-day market fluctuations
Once your money is in the market, it can be easy to obsess about the day-to-day fluctuations.
Spare your sanity. Markets will go up and down, and recessions and recoveries will come and go. The best strategy is to stay the course.
6. Not protecting yourself when disaster strikes
Bad stuff happens. It’s part of life. No one likes to think about losing their valuables in a burglary or the financial security of our loved ones if we were to die suddenly. These things happen every day, and if you’re not prepared, they can lead to financial ruin.
7. Putting off saving for retirement
If you’re in your 20s or 30s, retirement seems like a lifetime away. And it is, in a sense. But if you hope to get by in your golden years, you’re going to need to start saving now. IRAs and 401(k)s are traditionally the best vehicles for retirement savings, and it’s easy to open one and start stashing money away.
Start a retirement account today with just $5.
8. Letting your student debt suffocate you
Millions of young adults are wrestling with student loan debt. While there isn’t an easy way out from under it, you can see if there are options for lowering your interest rates.
Consider looking at refinancing your student debt. You could possibly save yourself thousands—or even tens of thousands—over the long-term.
9. Buy something you can’t afford
We all want newer, bigger, and better toys. Like a new car, for example. Americans love their cars and are paying more than ever for them.
In fact, the average monthly car payment is at an all-time high: $523 per month, according to industry data.
Take a look at your budget, and see what you can afford. For many people, a $500 monthly car payment is simply too much. Be smart, and consider what you would need to give up in order to afford an expensive new car.
10. Paying too much in fees
We’ve all been there. When you “swipe and pray” with your debit or credit card, and hope that the transaction goes through.
While sometimes you’re in a bind and have to make a purchase, making these types of relatively low-stakes gambles is an easy way to rack up banking fees, including overdraft or NSF fees.
And those fees add up. Go back to the beginning, and adjust your budget if you need to. Even consider dipping (briefly) into your emergency fund if it means you’re avoiding forking over more money to your bank. While a fee here and there isn’t a financial calamity, necessarily, making a habit of incurring these types of fees is going to set you back.
Read more: Other common fees that banks love to charge customers.
11. Letting your credit score sink
If you’ve never really paid much attention to your credit score, it’s time to start taking it seriously.
Your credit score determines how much you’ll pay in interest, and even if you’re eligible for a car loan or mortgage. Some employers even take it into account when making hiring decisions.
So, see where your score lands, and if need be, take measures to improve it.
Our guide: Why credit scores are important, and how to raise it.
12. Plan for the future—without you.
At some point, everyone’s time runs out. Like retirement, this may seem like a long way off, and hopefully, it is. But if you don’t get all of your ducks in a row now, your assets could end up in legal limbo.
13. Not diversifying
We’ve discussed the tendency of the market to go up and down. While you may feel helpless, to some extent, against the economic tides, you don’t have to stand idly by as a drop in the market takes a bite out of your portfolio.
What can you do? Diversify.
Check out our examples of how diversification can save a portfolio from disaster when the market takes a turn for the worse. Then, do some surgery on your own portfolio to make sure you’re squared away in the event of a downturn.