None of us are perfect. We’ve all made mistakes at some point, including financial ones. The point is to learn from them and make sure you don’t make the same mistakes again. When I look at all the common money mistakes that people make when handling finances, there are five that end up hurting us the most in the long run.

1. Not having an emergency fund and relying on credit cards to get by.
If you do this once or twice, you should be able to pay back your debt fairly quickly. However, if it becomes a habit, you will quickly rack up a large amount of debt. Too many households are living paycheck to paycheck, so if disaster strikes, it could cause financial devastation. You never know what curve balls life will throw at you – that’s why it’s extremely important to build an emergency fund. Credit cards should only be used when you are able to pay them off in time and in full each month.

2. Putting off saving for retirement.
The majority of people who contribute to their retirement accounts have just one regret: not saving earlier! It’s true – the earlier you start to save, the better. When you are in your twenties and still have a ways to go before you can retire, it’s hard to get motivated about putting money away. However, if you start making regular contributions to your account, your money will have a longer period to grow, providing you added financial security when it’s time to retire.

3. Paying off debt with retirement savings.
Yes, it is extremely important to get debt under control. However, you may want to think twice about borrowing from retirement savings. It’s hard enough to build these accounts in the first place, so if you take money out, it’s pretty likely that you won’t pay it back. Even the most disciplined savers will have a hard time rebuilding these accounts.

4. Trying to save money by dropping health insurance.
If you’re relatively young and healthy, you may not feel that you need insurance. You think, if you don’t buy insurance, you can save yourself a good chunk of money. However, medical conditions are always unexpected. There are years when you may not visit the doctor at all, but there may be other years when you have to go regularly. Life is unpredictable, and health insurance gives you peace of mind and protects you from coming out of the hospital with a huge load of debt.

5. Not having a budget or financial plan.
Regardless of whether you have debt or not, you need to create a sound budget and have a financial plan. You need to know what you are currently doing with your money so that you can make necessary changes to improve your financial future.

It takes most people a long time to build significant wealth, but it doesn’t take very long to lose it. It usually isn’t one decision – more so a collection of choices that bring financial issues. To avoid major pitfalls, start tracking your money, planning for emergencies, and have a plan for what you want to achieve. The sooner you start, the better off you’ll be.