Expert Interview with Christopher Holdheide on Recovering from Financial Mistakes for Mint

Most of us make financial mistakes, but where most of us just don't talk about them, Christopher Holdheide steps up and hopes you'll learn from his example on Stumble Forward. He talked with us about making financial mistakes and why it's not the end of the world.

How common are financial mistakes? Do we make a lot of them, do you find?

Financial mistakes are everywhere. I've made a lot of them, and the worst part about them is that we usually don't realize we've made them until it's too late.

One of my biggest financial mistakes came when my wife and I first got married, and we were on our honeymoon and were asked to check out a timeshare presentation. We went in with the intention not to buy but ended up getting one, thinking it would be a great way to take a vacation every year. However, because we had made poor financial choices, we ended up trapped in a timeshare that we couldn't get rid of and on top of that ended up getting caught up in a couple of other timeshare resale scams, costing us another $1,100.

Thankfully we were able to get rid of the timeshare a few years later, but we had to cut our losses and just accept that we were never going to get that money back. It was a painful experience, but we learned to pay closer attention to our money and not make hasty financial decisions.

What are some common "stumbling blocks" we find financially?

One of the biggest stumbling blocks I find when it comes to people's finances is simply not paying attention to their finances enough. In my case, I've noticed that when I wasn't paying attention to my budget, my spending would get out of control. However, when I started my budget, I realized how much more control I had over things.

On top of that, I feel you have to care about where every penny goes. Spending money foolishly or just spending it because you have it is another common stumbling block I see. Oftentimes, when I talk to people who happen to get some extra money, they always tend to talk about what they are going to buy with it.

Rather, I'm always looking at how I can invest that money to work for me even if it's just putting it aside in my rainy-day fund. I know those dollars will go further and work harder for me in the long run.

What are some misconceptions about financial mistakes you see online?

One big misconception I see a lot is people claiming things like credit cards are a financial mistake. But I don't believe a financial product can be a mistake. Rather it's how a person uses that financial product that determines whether it becomes a mistake.

For example, if you have a credit card and you pay it off every single month, it's not hurting your finances. However, if you have a credit card and you continually let that debt stack up, it's not the credit cards' fault that you accumulated that debt; it's your fault because you neglected to take responsibility and pay your debts off. Knowing the difference is very important here, and a lot of times when I think back to the financial mistakes that I've made, most of them came out of neglect.

If you realized you've hit a financial stumbling block, what's the first thing you should do?

When I find myself trapped in a tough financial situation, the first thing I usually do is reflect on the situation and ask one simple question: "What can I do right now that would improve my financial situation?"

I've actually done this several times and have managed to work things out in most cases. I feel when a lot of people get caught up in a bad financial situation, such as debt, we tend to take the long view on things, but what's wrong with solving things in the short term?

A good example of this was back a few years ago when I was $6,500 in credit card debt. I asked this question, I reviewed my budget several times and then the solution came to me. I ended up getting rid of my expensive variable universal life insurance policy which saved me $500 a year in premiums, and on top of that I was able to free up $12,000 from the cash value account of my old life insurance policy to pay off my credit card debt and set the rest back for an emergency fund.

You also run How do the two sites mesh for you as a finance writer? Do they overlap at all? Does one build on top of the other?

Both sites are tied to the personal finance topic, but that's pretty much where things end. With Stumble Forward, I focus mostly on financial mistakes, which can range from investing mistakes to handling your credit cards properly to other topics like identity theft.

Wallet Impact, however, has a tighter focus on helping people escape the paycheck-to-paycheck trap and taking control of your finances. I'm also sharing interesting ways I've managed to earn extra income, and I even have a segment each month where I interview people who are earning extra income in unique and interesting ways.

Together, each site has its own unique qualities, and I feel both complement each other in different ways. With Stumble Forward, I have a lot more of a broader range of topics that I cover, but with Wallet Impact, I am focused to one specific niche audience.

What are some trends in personal finance we should keep an eye on?

First off, I feel people are looking to learn personal finance in different ways such as podcast, blogging and video. It used to be that if people wanted financial advice they would seek out a financial professional, but today people want to consume this information in a way that fits into their life. For example, I listen to a few different financial podcasts, and I've learned more about how to manage my finances better than a financial professional has ever taught me.

I also see a lot of younger people looking to learn from people who they can trust, and not from your normal suit-and-tie financial guy. The amount of financial blogs out there has been trending upward and even more so in the last few years. I worked in financial services part time for four and a half years, and having all the fancy titles didn't make one bit of difference for me when it came to helping others with their finances. What people were really looking for is someone that they could relate to and get trusted advice from, not push them into buying a product.

Over time I think this will become more of the status quo, and people will look to those online and on social media to make better informed decisions.

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