Investment Mistakes That Cost My Coaching Clients $100K+

About this video

• Video Title: Investment Mistakes That Cost My Coaching Clients $100K+
• Channel: Tae Kim - Financial Tortoise
• Speakers: Tae Kim
• Duration: 00:13:40

Overview

This video identifies and explains five common and costly investment mistakes made by successful individuals, highlighting how these errors can significantly impact long-term wealth accumulation. The speaker, Tae Kim, shares insights from his coaching experience to help viewers avoid these pitfalls and improve their financial strategies.

Key takeaways

• Wrong Account Prioritization: Failing to prioritize the 401k company match before contributing to a Roth IRA results in a missed opportunity for guaranteed immediate returns and tax benefits.
• High Earners Hoarding Cash: Many successful individuals accumulate large sums of cash, losing purchasing power to inflation because they are waiting for the "perfect time" to invest, which ultimately delays wealth growth.
• Tax-Inefficient Fund Placement: Not strategically placing assets in the most tax-efficient accounts (e.g., holding high-growth, tax-efficient funds in tax-advantaged accounts like Roth IRAs, and income-generating, less tax-efficient funds in tax-deferred accounts like traditional 401ks) leads to higher tax burdens.
• Over-Optimizing Small Things: Spending excessive time debating minor investment choices (like choosing between VTSAX and VFAX) while neglecting crucial wealth-building actions (like maxing out retirement accounts or investing cash) hinders overall financial progress.
• Wealth-Destroying Advisory Fees: Paying high fees to financial advisors for basic services like index fund management can significantly erode long-term wealth, with the example showing a potential loss of $700,000 over 20 years on a $1 million portfolio.