CNBC Grow: “5 big money mistakes that can sabotage your financial life”
CNBC Grow, June 17, 2021 — In today’s article, reporter Sofia Pitt explains: “Even a few money missteps can take a huge toll on your finances. For example, when respondents to a January survey from the National Financial Educators Council were asked to put a dollar figure on how much money they lost last year due to personal finance mistakes, their average response was $1,634.”
To better understand the impact each mistake can have on your finances and learn how to avoid making them, she turned to Marguerita Cheng, CFP® Pro.
Rita shares: “For the best returns, experts recommend sticking with low-cost, long-term investments, not trying to time your trades to sudden swings in the market. For young investors, especially, it’s not about timing the market; it’s about time in the market.
For example, from the beginning of 2001 through the end of 2020, the S&P 500 returned an annualized 7.5%. So had you invested $10,000 at the beginning of the period and stayed invested for the duration, you’d have ended up with $42,000 heading into 2021. But if over the course of the same period, you missed the 10 best days for the stock market, you’d have just over $19,000, according to data from J.P. Morgan Asset Management.
Plus, if you’re moving your money in and out of the market, you’re missing out on the power of compound interest.