Money experts seem to know it all. With all their financial savvy and wise advice, it’s hard to imagine them as anything but knowledgeable powerhouses. Still, your favorite financial personalities weren’t always at the top of their fields. In fact, many of them made their fair share of mistakes on their way to success.
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Take real estate mogul and Shark Tank star, Barbara Corcoran, for example. While she’s no stranger to wealth and acclaim, she’s also well acquainted with financial missteps. The difference between Corcoran and someone who stays mired in financial pitfalls is that she’s willing to learn from her mistakes. Better yet, she’s not afraid to share those missteps to help you avoid doing the same.
Keeping Everything in a Checking Account
One of Corcoran’s original claims to fame is the $66 million sale of her real estate firm, The Corcoran Group, in 2001. You might assume she immediately jumped to make some investments or find other ways to grow her income further. You’d be wrong.
In a podcast interview, Corcoran admitted to stashing her cash in her checking account, saying she was scared since she didn’t have her “golden goose laying any eggs anymore.” Her long-term anxiety compelled her to keep everything in one place. Given that the limit on FDIC insurance is only $250,000 per depositor, per bank, per ownership category, a huge chunk of Corcoran’s money wasn’t insured.
By acting too conservatively, Corcoran not only left part of her wealth unprotected, but she also limited it’s potential to grow. While the odds of you coming into $66 million in one sale aren’t as likely as they were for Corcoran, you should still avoid stashing your entire life’s savings in a checking account.
Instead, consider high-yield savings accounts, retirement accounts, CDs or exploring the stock market to turn your financial seed into a flourishing garden of green. And if you’re not sure of the best place to put your money, consider meeting with a financial advisor to get some expert input on budgeting, saving and investing.
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Not Factoring in Closing Costs
As someone who made her name in real estate, Corcoran might seem like she’d have all the smooth moves down when it came to her own home purchases. However, she’s fallen to the same pitfalls that plague many homebuyers, including not having the closing costs ready when buying a home.
While many homebuyers are prepared with the down payment, they often don’t consider the closing costs, which can range between 2-5% of the total cost of the home. Corcoran told CNBC’s Make It that she once learned this lesson the hard way.
“When I bought my first home, I showed up at the table to close without the closing costs,” admitted Corcoran. “Thank God I was able to borrow it from the very nice seller, or I couldn’t have closed on the place.”
Even seasoned pros like Corcoran can overlook key details, like closing costs. When buying a home, make sure to account for all of the expenses, including closing costs. Planning ahead can save you from last-minute scrambles — or missed opportunities.
Thinking Money Will Solve Everything
Corcoran has lived on both ends of the financial spectrum, from being dirt-poor to making millions. If there’s one thing she’s learned from her life experiences, it’s that amassing wealth can make your day-to-day life easier, but it won’t improve the credit score of your soul.
She cautioned people against constantly looking for the next thing money can buy, calling this “the greed fallacy” in another interview with Make It. She explained, “The greed fallacy is there are as many miserable rich people as there are miserable poor people. Money has nothing to do with being happier. It really doesn’t.”
Corcoran went on to add that, despite her wealth, she’s still anxious and insecure about a lot of the same issues in her life. Her advice? Take care of yourself — emotionally as well as financially — as you work to achieve success.
Final Take To GO
Even financial icons like Barbara Corcoran have made money missteps, but that’s exactly what makes their advice so valuable. From keeping too much cash in a checking account to underestimating homebuying costs and overestimating what money can fix, Corcoran’s experiences are a reminder that financial growth is a journey, not a destination.
Corcoran is living proof that you don’t need to be perfect to build wealth. You just need to be willing to learn, adapt and take care of both your finances and your well-being along the way.
Caitlyn Moorhead contributed to the reporting for this article.
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This article originally appeared on GOBankingRates.com: Barbara Corcoran’s Top 3 Money Mistakes — and What You Can Learn From Them
