No matter your current age, retirement is probably the further on your list of priorities, as life is much more hectic with family, work, monthly bills, debt, etc. While all of those items are important to take care of in its current state, but something you may already know but have been avoiding, is that you need to protect your nest egg and make sure your financial future is secure. That can entail having an adequate emergency fund, not to mention continuously contributing to your retirement account so you not only have enough to live off when you do finally walk away from work, but can also enjoy the life experiences like traveling, fishing, and sleeping in, all without the headaches of work, that you have been dreaming about, so be sure not to mess up your nest egg.
Blowing Through Your Savings (or Not Saving at all)
While it’s important to see your favorite sports team, concert, or take a weekend getaway, there needs to be a distinction of what you can and can’t afford, and sometimes you will have to make sacrifices. By blowing through your savings on everything you want now, you are seriously jeopardizing your future, and while this is not a lecture on saving every penny, there is a line between not saving at all, and saving too much, which you will need to figure out in order to become successful.
Too Many Unnecessary Purchases
If you were asked how much you spend in a month, would you be able to say? While it may be hard to say right off the bat to the dollar, if you are completely in the dark then you’ll need to pull last month’s credit or debit card statement and start going line by line. As you notice some of the expenses that could have been avoided, just for fun, add them up and see how much you could have left if you trim out some of the unnecessary expenses. By avoiding eating out for every meal or continuing to pay cable when you never use it, you could easily have hundreds more dollars a month.
Household Budget Keeps Failing
Now how do you ensure that you cut out impulse and unnecessary purchases? Try a budget. While you are still in control of your own spending of course, by allocating certain funds out for food, gas, spending, not to mention monthly bills, by staying within that budget, and of course adjusting along the way, you can hope to see extra savings add up every month. If you decide that $400 is too much to spend on food, back it down to $300 if that seems more realistic and shoot for saving that extra $100 instead of spending it at the bar in one night.
Missing Out on Free Money
As you start to count, or at least be mindful of every dollar out, you might as well make sure that you are not missing out on free money. While some may think using a credit card is irresponsible, and sure it may be for those that can’t pay back what they charge, for those that can, by using a credit card just for the purchases you would be making anyways, you can earn rewards in the form of cash back or points. In addition, and even more important, check with your employer about company-matching contributions to your retirement account. By not contributing up to the full match, you could be missing out on thousands of dollars per year, let alone what it could add up to over the next few decades.
Not Checking the Performance
You can assume all you want, but without taking a look every month, or every quarterly statement, you have no idea how your hard-earned assets are performing. You could have too little or too much in one area, or just have the wrong allocations altogether, which makes it even more ideal to have a professional working for you that not only improves your financial performance, but that is trustworthy and cost-effective.
Not Actively Searching for Savings
Savings can come in all forms, such as clipping coupons, to online promo codes, but when it comes to expenses such as utilities, phone plan, mortgage or credit card rates, why pay more than you have to if there are cheaper options that you have not look into. Much like any other purchase you make, there is always room to shop around for the best rates, and saving a little each month can add up to huge savings over time.
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