Here they are, the final two mistakes in Sasha’s top-five screw-ups over at Consumerism Commentary. Mistake #4, “Failing to Balance Rental Property Income with Deductible Expenses,” is a bit specialized, although it contains a good lesson that can be applied to other situations. It’s the final entry, however, that applies to pretty much everyone (we’ve suffered from it ourselves in the past): “Failing to Remain Competitive Within My Field.”
Mistake #4: Failing to Balance Rental Property Income with Deductible Expenses
2007 was great for Sasha as a rental property owner,
…with the properties fully rented for all 12 months. The rent was even paid right on time. It was my lowest-stress year as a landlord on record, and yet this is the worst possible situation for tax purposes.
Why? Because she didn’t re-invest the income in property improvements, which would have increased their value while also giving her more deductions to work with.
Mistake #5: Failing to Remain Competitive Within My Field
The last one I’ll share is perhaps the worst of all, since it’s about more than just money.
If I don’t recover from this one, I could pay years of penance, not just suffer through one dismal tax year. My earning potential is something I need to carefully nurture, and that’s why I’m kicking myself.
Sasha plans on remedying this in 2008:
I’m going to start by writing out an action plan for getting my skills back up to snuff. Once I have established clear, S.M.A.R.T. goals, I will set aside at least 30 minutes a day to focus (no multitasking!) on these efforts, whether reading industry publications, attending training, pursuing a skill-building project or networking to learn the latest strategies.
“5 Stupid Financial Mistakes I Made in 2007: Failing to Balance Rental Property Income with Deductible Expenses” [Consumerism Commentary]
“5 Stupid Financial Mistakes I Made in 2007: Failing to Remain Competitive Within My Field” [Consumerism Commentary]