The Top 4 Financial Regrets and How to Avoid Them

According to a Quicken survey, 80% of Americans regret their financial choices. We've compiled the four most commonly cited financial regrets -- learn how to move on from these mistakes.

1. Not saving for retirement early enough

One of the top regrets mentioned in the Quicken survey was not investing more. And for many of us, the regret involves not starting sooner. Consider the difference early investing can make:

• Sam begins investing at age 22. For 44 years, Sam faithfully invests $1,000 monthly in a traditional IRA, earning an average annual return of 7%. At age 66, Sam has amassed a retirement fund of $3,193,450.
• Drew begins investing through a brokerage firm at age 42. Drew's been working for a while and decides to invest $2,000 per month. Like Sam, they earn an average annual return of 7%. At age 66, Drew has $1,396,240 put away.
• Taylor makes their first investment into a traditional IRA at age 52. Hoping to play catchup, Taylor puts $3,000 monthly into a traditional IRA, also earning an average annual return of 7%. At age 66, Taylor has a retirement account worth $811,818.

Thanks to the power of compound interest, time was on Sam's side. Even though Sam never raised the amount of their monthly investment, starting early allowed them to build a far larger retirement account balance.

If you haven't begun saving for retirement, beating yourself up serves no purpose. Your best move is to begin today, even if you start out making very small investments. Time and compound interest work in tandem to swell your investment.

2. Accumulating too much debt

Unless you live totally off the grid, chances are you live in a material world. While there are many reasons people accumulate too much debt, one of them is keeping up with the Joneses. Who wants to drive an old sedan when the rest of the neighborhood drives sleek, new SUVs?

If it helps, do this one thing before making a purchase: Imagine yourself five years from now. Will you still be over the moon excited about the new car? Or will you regret spending more than was necessary and building debt? Unless you can honestly say you'd rather have things than financial security, you may want to rethink the purchase.

Did you know? You can train yourself to love saving money. According to a study by neuroscientists in England, even if you can only save a dollar a day, watching your bank balance grow rather than shrink can light up the reward center in your brain. In fact, the less money you have, the more the reward center lights up with each savings. If buying items you can live without gives you a little mood boost, it is possible to turn it around so that saving money has the same impact.

3. Not having an emergency fund

The Quicken survey also revealed that 48% of Americans don't have the savings necessary to cover three months' worth of expenses if they lose their jobs. Even if you never face a job loss, life happens. Water heaters break, cars need new transmissions, and medical bills arise. Having money put away to cover emergencies means not having to go into debt to take care of business.

Putting a little money away each payday is better than losing sleep. For now, finding a bit to put away may come down to canceling a subscription service, premium streaming channel, or shopping around for a lower rate on home and auto insurance. And remember, the more you practice saving money, the easier it is to enjoy how good it feels.

4. Not investing in personal and professional development

Wondering about the "path not taken" is a human trait. However, one regret many adults share is not investing more in themselves. For someone who loves working on cars, that regret may have to do with never being formally trained. For a person working in a job they don't enjoy, it may be the regret of not going to college or not following their true passion.

The more you enjoy what you do, the easier it is to build a long-lasting, successful career. For some of us, landing a job we enjoy may mean more training. Or it could mean going out on a limb and starting your own business.

Everyone has their own talents and interests. If you manage to combine your talents with your career path, it's like getting paid to do what you love.

I've lived long enough to believe that we all have regrets, whether we admit them or not. However, the great William Shatner put it into perspective when he said, "Regret is the worst human emotion. If you took another road, you might have fallen off a cliff."

I say we embrace those regrets and learn what we can from them. We won't always get it right, but we can strive to do better next time.