common financial mistakes

As a CFP® professional who helps people handle their U.S. brokerage accounts from Israel, I’ve noticed four recurring mistakes people tend to make:


Diversification is an excellent financial strategy because it means that you are not relying on a single income stream. However, too much diversification can make it difficult to keep track of all of the different investments. If you are confused about your investments, you can end up making the wrong decisions about buying, holding, or selling individual assets.

Having unrealistic expectations about the rate of return

While I can certainly provide my clients with the latest information on the current prices of stocks and bonds, this information is always in flux. What is true today will not be true tomorrow. When analyzing market performance, you should remember that the reality of changing economic factors will always have a bearing on your findings and not everything may go according to plan.

Providing for children but neglecting personal welfare

All parents want the best for their children, but when parents neglect their own needs to help provide for their adult children, their children will eventually have to support them at retirement. While young children may need all of their parents’ attention, adult children should be fiscally independent.

Confusing “financial planning” with “investment management”

While both financial planning and investments are related, one is an idealization and the other the reality. Financial planning is about looking at your future income stream and expenses and figuring out what investments can help you meet your desired goals. Choosing investments is separate from financial planning. Create the plan first, and choose the specific investments second. Successful investors are often accomplished planners.

If you want to find more ways to avoid common retirement planning mistakes and to discover more choices available to you when planning your retirement, watch this video.

Douglas Goldstein, CFP®, is the Director of Profile Investment Service, Ltd., which specializes in helping people who live in Israel with their US dollar assets and American investment and retirement accounts. He helps olim meet their financial goals through asset allocation, financial planning, and using money managers.

Published October 6, 2014.

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