Mistakes are great. They’re tools for teaching. Above all, we can learn why we made them in the first place. The media doesn’t tire of telling Gen X that we’re behind on saving for retirement, as if we don’t already know. And we’re worried. Most of our stress centers around debt, kids in college and caregiving. Ah well, the great thing about mistakes is that we’re meant to learn how not to repeat them.

Al mono mas listo se le cae el zapote.

Even the smartest monkey will drop the zapote. FUN FACT: In the náhuatl language, spoken by the Maya, the tzapotl, or zapote, is a sweet fruit that grows in trees. This is a saying in Nicaragua (my mother’s native country) that means that even the best and most intelligent of us will make mistakes!

Now that you’ve had your Nicaraguan lesson on dichos, or sayings, let’s talk about Gen X and common money mistakes, and what to do about them!

12 Gen X Money Mistakes

1. Not getting the employer match in your retirement plan. This is leaving free money behind.
   • What to do: First, if you’re not contributing to a plan, talk to HR and get it started. It can be daunting to go from contributing nothing to contributing up to the match. Take it slowly. For example, increase the percentage over the course of a year. Once you’re getting the match, decide if you want to continue up to a higher amount.
2. Using retirement savings to pay for tuition.
   • What to do: First, send your kid to a two-year college. Second, transfer to an in-state university. Third, have them live at home. Fourth, apply for financial aid (scholarships and grants) and Work Study. Some of us haven’t finished paying off our own student loans. We’re not starting another generational debt cycle. And remember, there’s no financial aid for retirement/old age.
3. Not paying down debt. Interest rates are high and if you’re making only the minimum payments on your debt, you may find yourself paying off debt in retirement. You can pay debt and save for retirement. At the same time!
   • What to do: Develop a plan to pay your debt off using the snowball method or avalanche method. You could also consider consolidating debt under a HELOC (Home Equity Line of Credit) or a persona loan. Just be sure to get credit card spending under control. The last thing you want is to free up those cards by consolidating them and then maxing them out again.
4. Not having multiple sources of income.
   • What to do: Research ways to bring in more money each month or quarter. Start by downsizing around your home and selling things online; then
   • Look into opening a high-yield savings account and brokerage account for passive income from compound interest and dividends;
   • Monetize a hobby. Start a business. Downsize and invest funds from a sale.
   • Rent out a room or basement in your home, create a downloadable product and check out this Bankrate list for more ideas.
5. Not shopping around for better rates on your internet, mobile phone, health, auto and homeowner’s insurance.
   • What to do: Lower your bills. Call one company a week and request a reduced rate or temporary reduction in your bill. Ask about discounts (being 50+, union member, health care profession, firefighter, public service employee, alumni association, Costco).
6. Believing it’s too late for you to start investing for retirement.
   • What to do: Do you want $200,000 more for retirement? If the answer is yes, open a Roth IRA and begin investing. Someone who is 53 can max out a Roth annually for the next 15 years. As a result, this can add $200k to a retirement fund. This assumes a 6 percent return. Bonus: you won’t pay pay taxes on the withdrawals because Roth contributions have already been taxed!
7. Fearing the idea of downsizing.
   • What to do: Begin thinking now if you think you’ll be able to afford living in your current home and city. Will you be able to afford your mortgage after retirement? Property taxes? Maintenance?
   • In addition to the money it takes to maintain a home, you have to have the physical stamina. Start thinking now about different housing options. Some of these include renting your basement, buying a smaller home or home-sharing. Develop a plan now.
8. Not having disability or long-term care insurance.
   • What to do: If you have a job, you may have these two types of insurance. Can you keep them if you leave your job? Find out. Be sure to comparison shop to see if you can get the same coverage elsewhere for a smaller premium.
9. Ignoring your investments as you get closer to retirement.
   • What to do: Rebalance your portfolio at least once or twice a year so that it matches your short-term and long-term goals.
10. Hoping you can pray away that nagging health issue.
    • If you have employer-provided health and dental insurance, take advantage of the benefits it offers and get your annual checkups and cleanings.
11. Kids are grown and you’re paying for life insurance.
    • What to do: Some people like to keep the insurance until kids are in college. If the kids are graduated and working, do you need life insurance? If you’re trying to cut costs, decide if it’s worth keeping it.
12. Not having an estate plan.
    • What to do: At minimum, you should have an updated will, Power of Attorney for Health Care and Power of Attorney for Finances. Update your beneficiaries, guardians and executors and trustees. Consult with an estate planning lawyer to see how to protect your assets for your heirs.

It’s OK to Make Mistakes

In conclusion, understand that it’s OK to make mistakes. I’ve had to learn some things the hard way, but the important thing is that I’m learning. Learning from my mistakes has helped me teach my adult children how to be better money managers than I ever was. Remember this, generational knowledge is generational wealth!

If you want to organize your brain and your money for a successful retirement, and want some help, consider money coaching. I strive to make coaching financially accessible, so if this is something you want to look into, send me an email or get on my calendar for a free 30-minute strategy call.