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’ »

Many people want to save for their retirement but never get around to it until it is too late. There are three ways you can save for your retirement without feeling the crimp.

First, balance your budget. Many people do not have a budget much less a way to balance it. However, if you start with knowledge of where your money is going you can understand what to do with it. There is a reason to have a budget. To track your spending. If you cannot track your spending then you cannot save for retirement.

Second, switch an expense into retirement “spending”. People do not like to “save”. It doesn’t feel as good as “spending”. Why not think of it this way – you are spending today for your future by putting the money away in an account. It’s easy if you do things like cut your cable bill and turn it into your retirement account. Continue reading ‘3 Important Ways You Must Do Now To Start Saving For Retirement Before It Is Too Late’ »

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?’ »