Category: personal

Tips To Avoid Financial Woes

On March 20, 2018

In Blog, Debt, Entrepreneurship, Finance, personal

At some point in your life, you may fall under hard financial times. This happens to many people and does not mean the end of the world for your bank account or credit score. There are ways to come back from financial hardship and be prepared to avoid them in the future. This article will talk about some common financial woes and how to avoid them.

Create a Budget

Most people think they have a good understanding of where their money goes. Taking a closer look at your monthly spending may surprise you. Where your money is going may not match up to what you thought you were spending. A good way to avoid financial hardships and even dig yourself out of one is to set a budget for yourself. Take your monthly analysis of your spending and formulate a budget that will keep you in the green each month. Make sure your budget is tangible. Try not to guess at what you spend on certain items, be precise and you will be more likely to stick to your budget.

Impulse Buying

A common mistake among consumers is to purchase something on impulse. If you come across an item and immediately think “I need to have this!” Take a step back and evaluate the reasoning behind the purchase. Is this going to get me to my financial goals? Is this item necessary for me to buy? These questions will help control your impulses and ultimately keep you connected with your budget. If after a month you are still yearning for that item then save up enough money to get it for yourself.

Alternatives To Spending

Instead of going out to a fancy bar or restaurant, aim for a day packed with homemade sandwiches and a hike near your local trail. Any alternative you can find to spending money on miscellaneous things like a bar or restaurant should be pursued to help you save money and maybe even find your new favorite activity.

Medical Insurance

Nothing can help you dampen the blow of a medical emergency like medical insurance can. Without insurance, you are at risk of paying high fees for medical procedures that can plunge you into financial hardship for a long time. Medical emergencies are unpredictable, and it is better to be insured no matter your financial situation to avoid destroying your financial credibility for good.

What To Look For In A Financial Advisor

By Tom Leydiker

On March 2, 2018

In Blog, Entrepreneurship, Finance, personal

Finding a financial advisor is an important task in anyone’s life. Your financial advisor will walk you through your financial goals and then formulate a plan to help you reach them. Before you make a decision on who your financial advisor will be, consider the points listed in this article to ensure you are making the right choice.

Experience and Education

When looking for a financial advisor consider what kind of qualifications they have. Look for a Certified Financial Planner (CFP) before making your decision. Conduct an online search for your potential financial advisor and refer to any and all articles and websites about them. Follow up on previous or current clients to gather more information about their practices. It is one thing to state that a financial advisor has the proper qualifications but if they cannot correctly apply good methods than it is not worth the investment.

Pay Structure

The way a financial advisor sets up their payment structure speaks to their intentions in being your financial advisor. There are a few ways advisors can set up their payment structure. One way is commission based. Commission based advisors could be biased about what kind of investments you should consider because they are ultimately getting a cut of that investment. This could lead to investments that may not be working towards your financial goals. Another payment structure is fee-based. A fee-based advisor could give you advice that will benefit them in the long-run causing you to potentially stray away from your financial goals. Consider a financial advisor who charges by the hour. An hourly payment structure does not allow the advisor to be biased towards any financial decisions.

Contact

Make sure you understand how often you and your financial advisor will be meeting. Some advisors will have an initial meeting then only have scheduled meetings once a year from then on. If you are new to having a financial advisor, recommend that you and your advisor meet quarterly or more often than that if needed.

Outcome

You want to find a financial advisor who will point you in the right direction to achieve your goals. Eventually, you should be armed with enough knowledge to take over the reigns and conduct your own financial plan. Avoid getting stuck with an advisor who suggests that you need to stay with them to reach your goals. That kind of financial advisor may not have your best interests at heart.

Personal Finance Checklist: How Much You Should Save at Every Stage of Life

By Tom Leydiker

On September 26, 2017

In Blog, Finance, personal

Tom-Leydiker-Personal-Finance

The best way to build your personal wealth is to save your money as early and as often as you can. Having an account with compound interest will allow your money to begin making you more money. The bestselling author David Bach lays out a saving plan for each stage of your life in his book “The Automatic Millionaire.” The exact amount that is saved will differ from person to person depending on lifestyles and personal goals, however, Bach’s plan is a good rule of thumb to refer to.

The first decade you should start seriously saving is in your twenties. In your twenties you should be saving 10% of your gross income to your retirement savings and your emergency savings should be at least three months of expenses. If your company offers a 401 K plan and matches your contributions up to a certain percent, often somewhere between 3-5%, saving that 10% of your gross income just became much easier.

In your thirties, it can be expected that you’re not only providing for yourself anymore. You may have gotten married, may have had children, or may have bought a house. This is where you thank yourself for beginning to save at an earlier age. At this stage of life, 12.5% of your gross income should be saved for retirement and your emergency savings should cover your expenses for at least six months.

Your forties will be your peak earning years. This stage of life is going to be the most profitable time to take advantage of your increasing salary and save as much as you can. You should be saving 15-20% of your gross income to your retirement fund, and your emergency savings should be able to cover you for at least year or two of expenses. If you set yourself up with an account early on, you’ll truly start to notice your compound interest making money for you.

Once you’re in your fifties, you should be getting close to your retirement goal. Don’t stop saving once you reach this goal. You should be saving up until the day of your retirement. By this time, your emergency savings should be able to cover at least three years worth of expenses. It’s important to have this much in emergency savings because “the older you get the more you earn and spend. And if you lose your job it can take longer to find a job that replaces that income” explains Bach.

During your sixties and into retirement, you should still manage your money carefully. If you’ve followed the plan outlined above, you should be set to enjoy your money. Your emergency savings account should contain roughly five years of expenses.