8 Wealth-Destroying Money Moves George Kamel Says Silently Hurt Your Net Worth
If you have very little money saved, don't be down on yourself. You've still managed a feat that eludes 1 in 13 Americans.
The truth is, 8% of American families have a negative net worth, according to finance expert George Kamel, a Ramsey financial expert. Even households that think they're doing well financially may be building wealth too slowly.
In a recent video, Kamel broke down what he calls eight wealth killers that quietly destroy net worth over time.
Just Relax: I’m a Financial Advisor: Here’s How Often You Should Check Your Retirement Account Balance
Look Out! 5 Signs You’re Losing Money Every Month — and How To Find the Leaks
1. Too Many Depreciating Assets — Especially New Cars
Kamel warned that a "silent but deadly killer" is tying your finances up in assets that are "guaranteed to lose value over time."
The biggest offenders are cars, he said. He pointed out that new cars depreciate by about 60% in the first five years. This means a $40,000 car will be worth around $16,000 on average after just five years. Instead, drive an older car and invest the difference.
2. Not Tracking Your Expenses
Kamel called not tracking your expenses "financial chaos on the level of a third-grade field trip to Times Square." If you don't know where your money's going, you can't control it. He argued that overspending erodes your ability to save and invest, even if income is decent.
His solution is consistent tracking, whether through an app or a manual budget, to make sure spending aligns with wealth-building goals.
3. Not Tracking Your Net Worth
While the average person might not even think they have much of a net worth, Kamel said it is "the big picture scoreboard for your financial life."
You can't manage what you don't measure, he said. And tracking is part of consistent wealth building.
4. Renting Forever Without a Plan
Though there's nothing wrong with renting, Kamel suggested that owning a home "stabilizes the biggest line item in your budget" and builds equity over time.
Homeownership is also a powerful wealth-building tool "because homes appreciate over time and with each mortgage payment you build equity." He noted that 68% of millionaires have a paid-for home.
5. Lifestyle Creep
Lifestyle creep happens when you give every bit of extra income "permission" to increase your lifestyle, Kamel said. It's a quick way to wasting money.
"It quietly keeps people from saving and investing at the level they need to build some serious wealth," Kamel said.
His rule of thumb is to invest 15% of income once you're debt-free with a fully funded emergency fund.
6. Getting Divorced
While divorce is not something most people can plan for, Kamel warned that it's "one of the quickest ways to destroy your net worth."
Divorce destroys your net worth "by splitting assets, adding legal costs and forcing you to rebuild financially from a weaker position," according to him. Attorney costs and asset division are major setbacks, along with long-term expenses like alimony or child support.
Whether you consider prenuptial agreements or other legal ways to protect yourself, be aware of how broader financial stability and relationship stability are closely linked.
7. Borrowing From Retirement
It can be tempting to think of your 401(k) retirement account as a kind of emergency fund, but Kamel warned that to withdraw money from it early is to rob your own retirement.
When you pull money early, "that nest egg shrinks … and worse, you unplug the power of compound growth," he warned.
8. Playing the Debt Game
Kamel said people perform "wild gymnastics when it comes to debt," justifying it for tax breaks or potential investment returns.
Not only do you rob yourself of peace, he warned, you lock yourself into payments that limit your options. Instead of building wealth, "that kind of maneuvering doesn't build wealth, it just builds stress."
His advice is blunt: "Pay off your debt."
While none of these wealth killers feel dramatic in the moment, over years, even decades, they can determine whether your net worth grows or stalls out entirely.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
More From MoneyLion:
Discover Side Hustles To Grow Your Earnings and Make More Money
Warren Buffett: If You're Going To Splurge, Splurge on These 3 Things
7 Dollar Tree Items That Look Like They Cost $20 — But They're Only $1.25