3. Greed

3. Greed

If greed gets the best of you and you try to skimp on insurance, you might pay the price -- literally. So think twice before hoarding money to the point of being underinsured.

"Cutting corners on insurance is one of the most costly decisions you can make," Walker says.

She says falling victim to "short-term greed over long-term insurance needs" can put you at risk for having to pay out of pocket for medical bills and car and home repairs.

"What if you injure someone in a car accident or your dog bites someone? If you're sued, could you defend yourself in court or recover financially without proper insurance?" she says.

Being underinsured is a common mistake, agrees Barry. Many people fail to report home improvements to their insurance company or opt out of uninsured and underinsured motorist coverage. That can be costly.

"People think that they're saving money, but in the long-term, it's a bad move," he says.