When it comes to personal finance too many people bury their head in the sand. They make mistake after mistake never learning from them. Face up to those mistakes, learn from them and prosper. Don't feel bad, even the brightest of individuals screw up once and awhile. All of us have gone "Doooh!" at one time or another. Here are several common financial mistakes you could be making. Recognizing them is the 1st step toward correcting them. Taking action would be the second step.

Not Having a Financial Plan

Success with money starts with treating your finances similar to a business. Every business starts out with a plan and so should you. Every business tries to operate at a profit and so should you. This means developing a budget and adhering to it. It means setting goals with your money as well as your investments. This needs to be a written plan that is reviewed every quarter to ensure you keep on track. You may want to have a financial planner do this for you. Having a financial planner makes it easier to keep the course, but make sure the planner has your best interest at heart.

Investing in Things You Don't Understand

Keep your investments simple. If your portfolio includes assets that only a hedge fund manager would understand, then it's time to escape. Stick with the tried and tested like stocks, bonds, and mutual funds. Don't get swayed by the online courses trying to coach you on to make millions though trading. It's a good way to go bankrupt in a hurry. Manage your risk by diversifying or buying good companies cheaply.

Financing Everything

Don't finance things or run up credit cards. If you can't afford to pay cash for it then you can't afford to get it. It feels like no big problem to add on another $100 each month in financing, however , if you lose your pay, you still have to cover. Each time you include a monthly installment, you add another link to your chain of bondage. Do you want to to live a life of slavery?

Not Having Back up For Emergencies

Start learning to save a part of income for back up. Invest in safe securities so that it's there when you need it. It's also good to get in the practice of holding on to windfalls instead of spending them. You really should have at least half a year of salary as back up.

Too Little or Too Much Insurance

You should have insurance for all of the main things like home, auto, life, health and income. If a possible loss would result in a financial disaster for you, then you certainly should have insurance for this. Conversely, you don't need to insure every little thing like auto repair or your canine. These losses are recoverable without too much sacrifice.

Not Saving for Retirement

Not taking advantage of a 401k and/or a company match is probably the biggest mistakes people make. 401ks are the most effective investment vehicle available for retirement, but shouldn't be your only means. If you can, you should also invest for income like dividend paying stocks, bonds or real estate investment. That way you're not drawing down your 401k just to meet monthly expenses, but it's there when it's needed.

This is by no means an all-inclusive list, but looking after these things will put you back on course to a better financial life.

Make sure to check out my 10 Rules For Financial Successand How To Build A Winning Retirement Portfolio.