Financial Advisors Reveal Secrets to Building a Nest Egg
We work hard to earn money for our way of living. Yet it is inevitable to find ourselves in situations that require a huge sum. Thus we also understand the need to save money. Is it easy? People have different views on it but in consensus, it’s easier said and seen than done, especially when we don’t have an income that allows us to save as much as we want.
The intention will always be there to save. But it’s always the first step that’s difficult. So here are a few tips from financial advisors on how to be better at handling our finances and eventually help us stow away a portion of our income for future purposes.
Keep an eye on your expenses
Bily Xiao, founder of WealthMobius, describes adults as usually not having an accurate view of their income and expenses. However, when these individuals measure each of the two parameters, they can improve the way their money circulates. People must keep an eye on how much they’re saving, identify expenses that they can cut out, and establish incremental goals to help boost savings.
Merchants Bank advisor Jamie Pomeroy suggests that once people have crafted and established a budget with clear short and long-term goals, they can be automated in order to develop an easier way of getting into the habit of saving money. Individuals can setup regular and automatic deposits into investment and savings account when the paycheck arrives. This makes saving money a task less daunting to someone or even a task that is almost non-existent to him/her. However, one must be very cautious when opting for automation. Going online for transactions, especially in saving, does not warrant an individual to lose track of his expenses and cash flow. We should take the helm of directing our finances.
Say goodbye to debt
Scott Wellens, founder of FortressPlanningGroup and host of the “Best in Wealth” podcast, puts it straight to us when he said that the people who had a lot of consumer debt and other loans did not have the cash flow to save in the first place. Instead of earning interest coming from savings, people with debt now end up paying interest to credit companies. Therefore, the highly suggested way to start saving money is to not owe money in the first place and/or get rid of any debt as quickly as possible. Not only that. Once we are out of the debt, one should instill in his mind to stay away from the option of debt. By this, we will finally be able to say goodbye to debt’s way and be amazed at how much we can save in month when there’s no debt to be taken care of.
Have a financial accountability partner
San Diego Financial Planner Taylor R. Schulte suggests that having someone who can hold us accountable for the task at hand helps increase effectiveness and in the delivery of more optimal results. Apply this to the context of saving money and we’ll eventually find ourselves on the right track all the time.
This can be done by first establishing an achievable and realistic savings goal. Afterwards, look for an accountability partner or ‘buddy’ who can help us monitor our progress and hold us accountable for whatever happens to our own money. This may not be a must but it would be a plus to have a financial professional as a savings buddy. Our buddy can be anyone: a relative, significant other, friend, mentor, officemate, and others. So long as the main goal of having someone to help us become accountable of the finances through audits, that financial buddy will help us just fine.
Small, sure, and confident steps
Kansas City Financial Planner Clint Haynes advises that “when starting to save for the future, begin with an amount that we are comfortable with and is realistically affordable.” He recommends contributing the least amount needed to reach the company or bank’s match. Start at the minimum and when we become more and more comfortable with it, don’t forget to increase the amount to put into our savings. Take advantage as well of employer deals that can help speed up the savings game.
At the end of the day, it’s always nice to go home knowing that we are receiving our hard work’s worth with the things that we can do with our money. Saving sure does take much of mental effort over the decisions that we take and actions we do but it will serve us in the future, much more than we think it can. Know the money’s worth and let’s get down to the business of saving.
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