1. Failure to establish definite Financial Objectives & Implement a Plan for reaching them.People do not plan to fail- they fail to plan! They fail to set specific objectivew and implement a viable plan for realizing those objectives.
2.Ignorance of the Time Value of Money. Most of us do not understand the tremendous potential of compounding money over a period of time. For example 10,000 euros invested anually with 15% return can be more than 100,000 euros in 20 years.
3.Failure to Diversify Your Investment Portofolio and taking unnecessary Investment Risks.Each one must determine the degree of risk tolerance and create a balanced and diversified investment portofolio.
4.Failure to Implement Strategies to Legally avoid taxes.Income, Estate and Gift taxes can be substantially reduced or eliminated altogether through effective tax planning.
5. Inadequate Protection against unforseen Losses. Life, home, health,disability,Liability and other types of Insurance are mandatory today to protect against unforeseen and catastrophic losses.
6.Lack of discipline in spending habits can cause the Best plans to fail.
7.Unrealistic Expectations. Most people expect dramatic results overnight and become disenchanted when get-rich-quick schemes do not materialize.
7.5. Procrastination. Putting of until tomorrow what should have been done yesterday. This is financial suicide on the installment plan!