10 Ways to Go Broke

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  1. Not Reading the Fine Print - Do not sign a contract for anything, whether it's a gym membership or home, until you have read every single line, paragraph and had it reviewed by an accountant, lawyer or both. Hidden fees, confusing language and cancellation terms can all be hidden and cost you big if you don't pay attention. If you can't explain what you are paying for to someone else, consider a different option.
  1. Start Expensive Hobbies - You might have enough for the initial purchase of a boat or a horse, but the upkeep and continual financial commitment for these activities can be astronomical. A boat needs maintenance, storage, and licensing or education costs for using it that can all add up quickly. A horse needs food, caretakers, a stable, lessons and veterinary attention. Before you start something, think about how much you really will pay for it.
  1. Not Having Insurance - Health, life, home and disability insurance can protect you and your family in the event of an emergency or major life change. If your employer doesn't offer health insurance, look into low-cost options that at least have hospital coverage. Disability insurance can come into play if you are injured and unable to work, and life insurance protects the family left behind in case of death. In unavoidable natural disasters such as earthquakes or floods, your home insurance can help get you back on your feet. No one expects to be hurt or have their home destroyed, but not preparing for it could cause you even more pain and loss.