If you’re an investor who’s made an investment mistake, you’re not alone. Even the Oracle of Omaha himself, Warren Buffett, has made purchases that he regrets in one way or another. In an attempt to generate additional income, a retirement account, send our kids to college, or perhaps fund a vacation home, almost all investors have one thing in common – they want to make more money than what a paycheck brings in.
But sometimes what drives us toward financial success can steer us off the intended path. I’ve highlighted three potential investment mistakes to avoid to help keep investors on the right course, and to build stronger returns while optimizing efficiency – spending less time and money to make more.
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1. Underestimating the upsides of a 401(k)
When people use a 401(k) to invest for retirement, they pay no taxes on the funds they contribute in the year they make those contributions. That’s a big benefit – but it may not be the biggest one. Even better, many employers that offer 401(k)s to their employees will provide matching funds when you contribute to your account – up to a point. The average matching fund ceiling is 3.5% of your annual pay. But some investors make the mistake of not taking full advantage of their employers’ contribution matching, particularly if their company’s match limit is higher than average.
According to a national compensation survey…
