By Jeanne Sahadi, CNNMoney.com senior writer
Saving and spending aren't the only factors affecting your net worth. How you manage (or don't manage) your assets and liabilities can make a big difference, too.
1. Ignoring your money
You call it buy and hold. What you're really doing, is "buying and forgetting" or "owning and ignoring."
Your inertia could be costing you. So, "look at everything with a fresh eye. And ask yourself, `What does this do for me?'" said certified financial planner Mari Adam.
Consider your stock and bond investments. Do they still fit with your investment plan? (Do you even have an investment plan?) Maybe you have old stocks whose growth days are past and which may be trading at a loss from when you got them eons ago. In that case, you might harvest your tax losses. That will offset your capital gains now and in the future, thereby reducing your tax bill. And it will free up money to be invested more profitably.
Next, consider your cash holdings. If you have tens of thousands of dollars, or more, sitting in low-rate savings accounts or certificates of deposit, "you're just giving money away," Adam said.
For your longer-term money, it could earn better returns in a broadly diversified, low-cost index fund.
For emergency funds and money you'll need soon for upcoming expenses like a down payment, at least make sure you're getting a rate of 4.50 percent to 5 percent on it. Typically, Internet accounts offer the best rates, such as those at ING Direct or Emmigrant Direct.
2. Buying too much house
While it's never smart to be penny-wise and pound-foolish when making important investments like buying a new home, it's also never smart to think, "Oh, what's another hundred thousand dollars when I'm already spending more than I ever have?"
The answer is quite a lot and possibly more than you can handle.
Besides a higher mortgage payment, factor in the costs of homeownership, which grow with the value and size of the home: property taxes, home insurance and energy costs, consider future maintenance costs.
As a general guideline, it's best not to spend more than 2-1/2 times your income on a home. Your total housing payments should not exceed 28% of your gross income. Total debt payments, meanwhile, should come in under 36%. That means payments on all loans, including your mortgage loan, school loans, auto loans and credit card debt.
3. Driving too much car
Certified financial planner Mari Adam has seen couples with car payments totaling $1,400 a month. Would it kill them, she wonders, to drive cars that combined would cost them closer to $800 or $900?
Another planner, Chris Cooper, has suggested as a rule of thumb that you don't spend more than 8 percent of your monthly gross income on a car payment, less if you have credit card debt.
Money Magazine has estimated that driving less expensive cars could yield an additional $180,000 over 30 years, assuming you invest your savings. Remember, in addition to your monthly payments, you'll be paying for insurance, fuel, maintenance and repairs.
To find out a car's cost of ownership over five years, use Edmunds.com's True Cost to Own calculator or Intellichoice's Side-by-side Comparison.
4. Paying the IRS, not yourself
Small business owners have a lot to worry about, and retirement usually gets bumped from the list in favor of more near-term concerns. But there are serious tax breaks to be had if you set aside some money for retirement now, breaks that will reduce the money you owe the IRS, and boost what you pay yourself.
If you're self-employed, you may contribute up to 25 percent of your self-employment income (gross income minus expenses) to a SEP (Simplified Employee Pension) and deduct the full amount. You can also set up SEPs for your employees and make tax-deductible contributions to them.
Another option, though less flexible, is the SIMPLE 401(k). If you have 100 or fewer employees and they each earn at least $5,000 a year, you and your employees can contribute up to $10,000 a year pre-tax and your company must match the contributions.
5. Always getting what you want
Living above your means and charging the difference is the financial equivalent of slow carbon monoxide poisoning. It makes pre-existing financial problems worse and can be the cause of headaches and shortness of breath until you address the source of your problem.
The solution: "Don't always keep buying what you want. It'll get you in trouble,"
If you have a credit card balance, figure out the fastest way to pay it down. Consider whether it makes sense to transfer your balance to a lower rate card. Then figure out how long it will take you to pay off your debt under different scenarios.You might also figure out where you can squeeze out some money from your current budget to maximize your payment. Then automate your payments so that they go straight from your bank account to the credit card provider to avoid late fees or missed payment penalties.
6. Letting your assets linger
Net worth is a measure of your assets minus your liabilities. But all assets are not created equal. Hanging on to assets that don't do much for you may hurt your net worth long-term.
Sometimes, you should "move an asset from one pot to another where it can produce more income. Monetize something that's not monetized," said certified financial planner Mari Adam.
She cites a case of a couple in their 70s who were house rich but cash poor, down to their last few thousand dollars. They chose to sell their house, bank the money and let it produce income while they rented. That saved them money in the long run since they otherwise would have needed to take equity out of the house to make ends meet. "Net worth is one thing, but cash flow is another," Adam said. "That's where people go wrong with real estate."
Likewise, a second home may be worth a lot on paper, but how much does it take to maintain? "Something may have value, but if you don't have the cash to pay for it, you'll lose it," Adam said.
7. Letting your debt lie
If you've got debt that you can't pay off in full, you may end up paying more than you have to if you just assume that there's nothing you can do about it. In fact, you might be able to reduce what you owe if you keep an eye out for lower rates that may be available to you. If you got an adjustable-rate mortgage at a low teaser rate in the past couple of years and it's scheduled to reset to a much higher rate, now may be the time to consider getting a fixed rate mortgage.
If you've got credit card debt, transferring your balance to a lower rate card can save you money ... if you do it right. Make sure that there's not an onerous balance-transfer fee; and if there's not, move the balance to another card but be sure to pay it off before the low rate expires.
Also, to avoid lowering your credit score, don't close the higher-rate account after you transfer your balance out of it. If you do, you'll lower your total credit limit, and that will negatively affect your debt-to-credit-limit ratio.