There are some typical common mistakes people make while investing and managing their money. There are few common mistakes which investors often do and here i’m sharing top common financial mistakes:

• Not covering their basics
• Timing the market
• Underestimating the retirement corpus
• Not planning for life after retirement
• Not saving enough
• Ignoring insurance role in personal finance
• Investing without goal
• Too much use of credit cards
• Spending money without thinking

Though i’m going to discuss about one of the important mistake people do while investing which  is -Personalizing Personal Finance. Yes, one of the foremost common mistake is, people tend to repeat others decisions for his or her money and forget this easy yet important tip – It’s personal finance, personalize it.

Want to understand why? then let me tell the rationale for this. This reason is predicated on my experience:

Many times, people come to me with questions about investing and personal finance. Some investors send me their investment details/portfolio and ask if it’s good or not? once I ask- what’s your goal, risk-taking capacity, investment duration etc. they’re either clueless about of these or just neglect all these factors for the sake of profit earning. I noticed that people/investors often ignore basic factors like goal, risk, duration of investment etc. and been investing on the idea of other’s recommendation or just by following others investment strategy.

But why people invest their own money on the idea of other’s financial decision. May be because they think this will also earn money/profit as others. They think that others planning and investing experience will help them with their investments. Yes, it’s good to learn from others experiences but it isn’t necessary that they’re applicable to your financial situation or decisions.

People invests within the stocks or mutual funds simply because they heard successful stories from their friends/relative that how they earned profit out of it and that they follow an equivalent path so as to earn more returns. But what they do not understand is- one size doesn’t fit all, in personal finance.

Let’s first understand what’s Personal Finance:

Personal finance is about meeting personal financial goals, like whether one has enough saving to satisfy his/her financial needs, planning for retirement goal, or saving for child’s college education goal etc.. Though goals of varied investors could match but amount of saving, income/expenses, risk capacity, duration of investment and overall financial situation will always differ.

Therefore, one shouldn’t invests on the idea of other’s suggestions or by following other’s investment plan. Personal financial planning depends on your income, expenses, investor profile, individual goals and taxes. Also, investors should plan their finances by taking into consideration their financial constraints.

To summarize: Don’t make investments on the idea of others recommendation because every investor has different goals, risk, duration, income and saving, financial issues etc. As they assert, one shoe size can’t fit all people, there is no tailor-made personal financial plan suitable for all investors. Personalize your finances and take hold of your money.

Note:-This article is based on one of my Quora answer.