The 10 Financial Mistakes That Cost Families Dearly

Most financial mistakes are not calculation errors. They are blind spots: topics we put off, or never address at all. Freely adapted from the observations of Ben Felix, portfolio manager and well-known financial educator, here are the ten most common mistakes families make — and why they weigh so heavily over the long run.

1. Not earning enough

Income is the raw material for everything else. Before talking about investments, you have to talk about your capacity to save — and that capacity starts with what you earn. Investing in your skills, negotiating your compensation or building a complementary source of income often delivers a better return than any investment product.

2. Under-saving

Earning well without setting anything aside is running in place. Your savings rate remains the single most important driver of your financial independence — well ahead of investment returns, especially in the early years.

3. Having no financial goals

Without a target, there is no way to know whether you are making progress. An RESP for the children’s education? A TFSA for flexibility? An RRSP for retirement? Clear goals guide every decision — which accounts to use, how much risk to take, and over what horizon.

4. Spending on the wrong things

The problem is not spending — it is spending without thinking. The expenses that bring you nothing over the long term — no lasting usefulness, no memories, no real well-being — are the ones that cost you the most.

5. Taking too little risk

Leaving $50,000 sitting in a savings account “to be safe” means getting poorer in real terms once inflation is taken into account. With a 10-, 15- or 20-year horizon, inaction has a very real cost — the returns you give up.

6. Taking the wrong kind of risk

Taking risk does not mean taking any risk. Concentrating a portfolio in a handful of stocks, chasing whatever is fashionable or investing in things you do not understand exposes you to permanent losses — a very different risk from the normal volatility of a broadly diversified portfolio, which can be ridden out.

7. Missing out on tax optimization

TFSA, RRSP, RESP, FHSA — these accounts exist for a reason. Each offers a distinct tax advantage, and the order in which you use them changes the outcome. Not using them means leaving money on the table, year after year.

8. Ignoring estate planning

A will, a protection mandate, a legal guardian for the children: if the unexpected happens, who takes care of your kids? Who inherits, and on what terms? This is not a “later” topic — it is precisely the topic no one finds time for until it is needed.

9. Not sharing the same financial values as your partner

Money conflicts are among the leading causes of separation. Addressing budgeting, saving and debt early protects both the couple and the family. A shared financial plan, even a simple one, prevents a great deal of tension.

10. Being underinsured against catastrophic risks

Disability, premature death, critical illness: if your income disappeared tomorrow, could your family manage? Insurance is not meant to make you wealthy — it is meant to make sure the plan holds even in the worst-case scenario.

Our recommendation

Every one of these mistakes can be corrected with a clear plan and personalized guidance. If one of them resonates with your situation, now is the right time to talk about it. Book a meeting with our team — we are here to help you align your finances and protect what you have built.