It sure would’ve been nice if we were all born with a handy instruction manual for how to best navigate life’s financial highway. Alas, many of us have been left to our own devices, to gain wisdom through weathering financial storms that very well could’ve been avoided if we’d but had the proper guidance. Well, it doesn’t have to be that way for you. We’ve rounded up an all-star collection of key financial tips that everyone should absolutely follow. Consider each tip to be its own stepping stone toward ultimate money management enlightenment. Let’s dive into some of these helpful leads on how to lead a healthy financial life.
401K investing is crucial
You’ve probably heard of 401K investment talk at some point in your life. It’s easily one of the most important things to keep a watchful eye out for when you’re signing on with a new company. Many companies nowadays will take care of their employees by matching some part of their 401K contributions. Anyone who is able to invest in their 401K and IRA accounts regularly ends up having a much better chance at actually being able to retire comfortably. This also changes the game for anyone who isn’t starting out with a whole lot of money. It’s basically a surefire way to get a leg up for later in life.
A good credit card score is the golden ticket.
It’s terribly easy to fall into a vicious cycle of using your credit cards, stacking debts, and ultimately eating away at your credit card score by not being able to juggle all those debts. If you’re able to resist all those pressing temptations to use your credit card, you’ll ultimately be able to hold onto a much more sizable spending power. With greater spending power you’ll be afforded the ability to purchase those life-defining things like real estate and be able to take out far bigger private money loans from borrowers than you’d have been able to with a low credit card score.
Real estate investment is an effective wealth builder.
One of the best ways to start stacking that cash is to invest in some real estate if you can handle the initial payments. You’ll need multiple streams of income for building up that wealth, and by owning an investment property you’re able to diversify your financial portfolio. The money you generate from an investment property can also be called mailbox money or passive income. This means that you don’t have to invest any of your precious time in trying to generate funds, because the real estate is already doing it for you. However, if you do want to spend your time and energy on a piece of real estate, consider looking into fix and flip loans Oregon. These guys can set you up with the kind of low-interest capital that you’ll need to fix a property up, and then try to flip/turn a profit by reselling it at its new and improved higher house market value.
Shop smart.
You should absolutely never pay the full retail price. This is one of the easiest ways your bank account ends up taking unnecessary hits. But what kinds of materialistic possessions can you avoid paying the full retail price for? Well, first you’ve got your electronics. There are numerous helpful online resources available to you that’ll help you lock down that next used or refurbished iPad or Kindle. Just make use of one of those, and consider full-price items to be the last resort for where your hard-earned money goes. You can also save handsome amounts of money back by shopping smart at your grocery store and keeping your radar on for some hidden best deal options spread throughout the aisles. You’ll be shocked at how much your grocery bill is reduced by hitting up those discount sections. Plus, you’ll still be able to eat healthily. Spending extra on fancifully packaged grocery items doesn’t guarantee that you’re eating healthier food. If anything, this may be a manipulative marketing tactic that companies use to take advantage of consumers.
Pay yourself before anyone else.
Consider that transfer of funds from your checking to your savings account, to be an investment in your future self. You can also set up your checking account to automatically transfer money to your savings account so that you don’t even need to keep track of it. From there, the reality is that you’re far less likely to spend money if you just tuck it away right off the bat, and don’t wait for the maddening materialistic temptations to pop up.
Set clear financial goals.
If you don’t make those financial goals crystal clear, you’re bound to have far too easy of a time convincing yourself to spend money that you never should’ve touched in the first place. So, write out those goals on a piece of paper. Identify what you aim to achieve in the next few months, then the next year, and then the next five years. This will help illustrate a clear picture of where you want your future and best self to end up. Without a sheet that identifies those goals, you’re pretty much flying blind, and dangerously vulnerable to impulsive, money-draining whims.
Set aside an emergency fund.
No matter what your financial goals end up looking like, you need to have to establish an emergency fund in there. Sure, it isn’t the most fun trying to build a nest egg that doesn’t seem to bring you any measurable instant gratification. You naturally want to funnel that money into all the shiny toys that catch your eye in daily life. You’ve got to resist these urges, though. By remaining honest with yourself about what kind of budget you’ll need to build this emergency fund, you’ll actually end up chipping away at any stress you might be carrying in regards to job stability.
Just knowing that you have a safety net if the world decides to go crazy as it has recently during the Coronavirus pandemic, will bring you a bit more peace of mind. You’ll never be able to put a price on the value of inner peace. Don’t feel bad if you haven’t started up with an emergency fund yet. Nearly 24% of Americans don’t have an emergency fund at this point—don’t be like them.
We’ve touched on some of the essential boxes you’ve got to check off when it comes to having a smart and effective financial plan. One of the other key things to remember as you go about putting together a financial plan uniquely tailored to your life situation is to not be too hard on yourself. You’ll need all the energy that you can get to remain diligent and conscious in the face of many tempting and expensive distractions.
Also, if you’re ever caught up in a feverish case of the money stress sweats in the middle of the night, just remember you’ve got a tireless advocate, a champion of the retirement dream, John Arnold. John Arnold and his wife Laura both started up Arnold Ventures with the explicit purpose of trying to help the people that need it the most. One of the cornerstones of their firm is putting together a leading team of researchers to fix that broken retirement system in the U.S. It’s bleak at this point. Only 33% of the people in the U.S. have an actual retirement savings account. You and everyone else works far too hard in this life to not be able to turn in for the night, knowing that one day you won’t have to punch that clock for the job anymore.
