Best Finance Personal

There are so many productive ways to spend our money: saving for retirement, paying off the house, paying down consumer debt, and don’t forget about reasonable spending to make life more enjoyable. So what should take priority? Here are some things to consider.

401(k)

First, determine whether your employer’s 401(k) has a match. For instance, many 401(k)s match your contributions dollar-for-dollar up to 4% of your salary. A match like this is simply too beneficial to resist. Think of it this way — we hope to obtain a rate of return of 8 to 10 percent on our investment portfolio, but if our employer offers the match described above, we are guaranteeing ourselves an immediate 100% return on our investment.

However, depending on circumstances, it may or may not be wise to contribute more to your 401(k) than your employer will match, and if your employer offers no match, there are other factors that need to be considered.

Consumer Debt

I frequently see individuals with credit card debt with interest rates between 20 and 30 percent. If we are not getting an additional match from an employer on retirement savings, does it make sense to invest in the market where we hope to obtain a 10 percent return when we can essentially guarantee ourselves a rate of return of 20 to 30 percent by paying off these debts? One would be better off paying down debt with these high interest rates before investing elsewhere. Continue reading ‘The Best Use of Your Money’ »

Immediately after you stop working you feel free, finally you can do what you want with your time! Shortly after, however, many start to feel lost and unsure of what to do themselves with their unstructured days. Luckily it doesn’t have to be one way or the other, you don’t have to have your whole day planned in order to gain some structure back to your life. Below are some retirement activity ideas for workers who miss the daily routine and want to get their lives moving again.

The first thing to think about is what did you want to do with these years of your life? Do you want to spend this time with family and friends? Do you want to learn new skills? Do you want to travel? Do you want to do a mix of all these things? Try and incorporate this into some routine things you can add into your week. You want to keep some sense of spontaneity, but you don’t want to be sitting at home bored, either. Continue reading ‘Retirement Activity Ideas For Workers Who Miss the Daily Routine’ »

I hate when people respond to a question with a question, but my answer for how early can a person consider retirement? Is how much can a person save before hand? There is no straight forward answer to these questions because every situation is so unique. There are a number of factors that contribute to this answer. For instance, how much you save each year, how your investments do, what it is you want to do in retirement/how much money you’ll need each year, and how long you’ll be in retirement. This is a lot to take into consideration.

Since the question mentions it we’ll start by looking at how long you’ll be in retirement. Unless you have a medical condition that already tells you otherwise, you’ll need to budget for a long life. Plan on living to be 95, although if you want to play it safer it’s not a bad idea to budget for 100 years of age. Continue reading ‘How Early Can a Person Consider Retirement?’ »

For most people this isn’t much of a consideration. You’re just hoping you can save enough to help with college expenses and hopefully have enough for your own retirement. But stop and think about this. What would your kids have for assets if they started saving for retirement now?

I’ve given this some thought and done a bit of research. The govenment makes it hard to just open a retirement account when you’re super young and don’t have income. Nearly impossible really. But once the kids are old enough to have a job you can start an IRA for them. If they start young enough the contributions don’t have to be very much for that amount to snowball with time and turn into millions upon millions they would have for retirement. Don’t you wish your parents had given this same thought to your future? How much more secure would you feel if you already had $200,000 in retirement savings and you’re still decades from retirement? These kinds of things are possible because of the benefit of time. The longer you have to invest, the more that money compounds and turns into bigger and bigger amounts. Continue reading ‘Are Your Kids Saving For Retirement?’ »