You can not be a financial success if you do not have savings or do not live an extravagant life style. Question: Do you know what your net worth? Many people do not and are afraid to even try to determine what it was. It might just be the thing to get you to take action to save your money.
How Much Can you Save?
Some say saving 10% of your income. I say save more, but it all really depends on how much debt you’re working with and where you want to be in the next year, 10 years, or with a pension (this must be specified in your destination). If you are looking to retire in 30 years, investing $ 300 a month at 8% will yield you about $ 440,000. Enough for a couple to retire, and probably much more than where you are heading.
What if I have debts?
If you have debt, it is important to get the debt out of the way. The logic here is that most credit card interest rates rose from 12 to 13%. If you have debt on that card, but decided to keep your money in the account to get 5-8%, you lose money.
So what to do? Saving enough for a pillow. Determining how much you may need quick emergency cash like $ 1000 – $ 2000 dollars, and save this amount. Once there, devote however much you put yourself into that account to pay off your debt as quickly as possible.
Then what financial methods should I use to store my money?
Good question. There are many options that will get you where you want to be a financial success. When I think about where I want to save my money, I thought of a few things:
1. What is my goal to keep this money? (Very important)
2. How much risk I am willing to take?
3. Can I get my money quickly?
4. How much should I want to save?
5. Any reputable company should I save / invest safely?
6. How much can I set aside monthly to achieve this?
7. How long will I be saving for the future?
I recommend separating your savings into several accounts (Christmas savings, car savings, retirement savings, etc.) and for each, making a choice that will be conducive to how you will use the account.
If you are saving for a car for one year, you may want to use 1 or 2 yr CD. If you are saving for Christmas you can do a one-year CD, or use a Money Market account to enable you to get your money if you have an emergency before Christmas and will have to sacrifice some funds. If it is to save for your retirement, there are a lot of annuities, the most famous is the traditional IRA and the Roth which provides significant tax advantages depending on how you use it.
The Next Step: Take Action!
Now it’s up to you to make a choice. Take action today! It is important that you are clear about what you want to do, seek professional help (for your money, not your mind) if necessary, make a decision, then do it! Being a financial success that you have always wanted to be, today.