Worst-ever bits of financial advice to watch out for

We occasionally, in this space, have listed some of the best bits of financial advice people have ever received.

That got us thinking – what are some of the worst bits of financial advice that have been doled out to people. In the interest of protecting us all from being steered the wrong way, Save with SPP is on the lookout for the worst of the worst, in terms of financial advice.

“Let the bank come get it,” is identified by the A Dime Saved blog is a top bad financial idea.

“When you finance something whether it’s a car or a home, you’re entering a legal agreement to pay for it. If money gets tight, you should be reaching out to your lender to negotiate, not ghosting them. Walking away and letting the bank `come get it’ might sound like a bold move, but it comes with long-term damage to your credit score that could haunt you for years,” the blog explains.

Another one on the blog’s list is “take a loan to pay off a loan.”

“Unless you’re consolidating debt at a lower interest rate, using one loan to cover another just digs a deeper hole. It delays the inevitable and compounds your financial stress. It’s not a solution — it’s a snowball,” the blog warns.

A third one is “put everything on a credit card for points.”

“Chasing credit card rewards without discipline is a trap. The points might look great, but the interest you’ll pay if you don’t clear your balance each month will wipe out every perk. If you’re not careful, your spending will spiral,” the blog explains.

The SoFi Learn blog suggests that “you don’t have to worry about retirement until later” is a particularly unsound bit of advice.

“Friends, family, and acquaintances may tell you to enjoy your youth and not to worry about your old age until later,” the blog explains. “However, the sooner you start to save, the more money you’ll have later on thanks to compounding interest, which builds earnings on your investment and on that investment’s interest. Putting off saving until midlife can put you behind the eightball, causing you stress and anxiety as you try to make up for lost time,” the blog adds.

A second idea in the blog is that “follow your passions” may not be the best financial advice you’ll get. “Although it sounds nice, following your passions professionally rarely pays the bills. And it can also put you into a very competitive and crowded field, if your passion is one of the common ones; say, acting, singing, cooking, or creating art,” the blog warns.

In a Global News article, a number of bad ideas are captured. Common bad financial mistakes, the article notes, include “using a credit card advance to fund a down payment, using student loan money to travel, moving too often and any investment seminar promoting a ‘sure-fire way to beat the market.’”

We can add a few more from our own travels. Thinking it’s OK to only make the minimum payment on a credit card. Taking a vacation “on the card,” without saving anything for it in advance or to pay down the debt afterwards. Unwittingly paying super high fees, front-end and back-end loads on investments. Not really knowing how much you are spending versus how much you are taking in.

Avoid these potential pitfalls, live within your means, and save for the long term. If you have a pension plan through work, be sure you are signed up and contributing to the max – don’t decide you’d rather spend that money versus setting it aside for your post-work future.

If you don’t have a workplace plan, the Saskatchewan Pension Plan may be just what you are looking for in terms of a savings partner. SPP is open to any Canadian with registered retirement savings plan room.

You decide how much you want to contribute – and you can also transfer in any amount from your other non-locked-in RRSPs. You provide the money, and SPP’s investment wing does the rest, growing your money in our low-cost, professionally managed pooled fund.

At retirement, those savings will turn into income to live on. Options include a monthly, lifetime annuity payment, or the more flexible Variable Benefit.

Check out SPP today!

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It’s a tough landscape for saving out there. Higher costs for housing, groceries, fuel, and life in general make it very hard to squeeze out a few bucks to earmark for your post-work future.

However, having been the brother of a very frugal sister, Save with SPP has seen what a little tightfistedness on the spending side can do for one’s piggy bank. Let’s take a look at some frugality tips from the experts.

The Little House Living blog offers up some “frugality outside the box” ideas.

One is to “meal plan for an entire month.” With this idea, you’d not be eating out at restaurants, and would know what to shop for at the grocery store.

Another radical idea – “get rid of the cell phone and go with landline.”

“So few of us truly NEED a cell phone, we’ve just become spoiled to the idea we do. Also, extreme? Get rid of the TV and thus the streaming needs. With all that, do you need internet,” the blog asks.

Wow. That’s extreme frugality!

A final one from this blog that we’ve not seen before is “shop the perimeter of the store… it literally cuts grocerying in half.”

The A Dime Saved blog features some tips that “people laugh at, but actually work to save money.”

The blog suggests making your own condiments. “You’d be surprised at how easy—and cost-effective—it is to whip up your own condiments. Salad dressings, flavored vinegars, or even your own ketchup—once you get the hang of it, you’ll never want to buy those pricey store versions again,” the blog notes. We recall our grandma in New Brunswick making her own mayo, among other things.

What about cutting your own hair, asks the blog.

“For some, the idea of cutting their own hair is terrifying, but with a little practice and the help of online tutorials, you can easily save on salon visits. A trim here and there can make a huge difference, and you might just find you’ve got a hidden talent for it. Worst case? You save money,” the blog explains.

Finally, a more familiar one – grabbing a few toiletries when you stay at a hotel.

“From soaps to toilet paper to tea bags, those small items are already factored into your hotel bill. Why not take advantage of them? It’s one less thing you have to buy when you get home,” the blog concludes.

Finally, GoBankingRates provides a few tips for retirees.

First, the blog suggests, review your streaming subscriptions and cut back. “If you take a close look at your monthly bills, you might be surprised to see how many recurring charges you rack up every month,” the blog warns. There are cheaper and even free streaming options out there, the blog adds.

“Comparison shop,” the blog advises. “Nearly any product or service you’re interested in is likely offered by a number of different vendors, so you can pick and choose the combination of price, service and quality that works best for you.”

As well, retirees who are also empty nesters should consider moving to a smaller house, or an apartment.

“Frugal living tips can go a long way toward saving for retirement or living your best life once in retirement,” the article concludes.

If you are able to squeeze some savings out of your monthly spending, then for sure retirement saving is a good place to direct those loonies to. If you are saving on your own for retirement, take a good look at the Saskatchewan Pension Plan. SPP takes the hassle out of retirement saving by making it simple – you contribute however much you want, and SPP invests it in a low-cost, professionally managed pooled investment fund. At retirement, your options include collecting a lifetime monthly annuity, or the more flexible Variable Benefit.

Check out SPP today!

Join the Wealthcare Revolution – follow SPP on Facebook!