Ready to hit the ground running with your financial resolutions? David gives a list of seven things to cover in this two-part series.
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How can you invest in your financial future? In the second part of this series, we cover the four remaining financial resolutions you should be implementing this year. Before we get started, did you hear the first three resolutions?
Our next resolution is primarily geared toward those in their 20s, 30s, and 40s. Save as much as you can, as early as you can. Save at least 10 percent of what you make and then move that percentage up over time. It’s never too late to start, but David shares some figures on what difference it makes between saving early and saving later on. Are you living within your means and saving toward your financial future?
When you save, are you consistent? Having a systematic savings will allow you to save without even worrying about spending it. This could be through your 401(k) or even an IRA that you set up yourself. What if you have student loans? Should you still save systematically? David clarifies when this could still be advantageous. The difference you make with systematic savings means a small change to the amount you spend each month because you’re putting it into long-term savings.
Have you done your annual net worth statement? This is one of David’s favorite tools for helping people achieve their financial goals and dreams. It provides a record for yourself to look back and see steady progress for your goal. Write down all of your assets and their worth, then write down what you owe. The difference between the two is your net worth. What does your momentum look like? Is your net worth bigger than last year? Why or why not?
The last one is an easy one, but incredibly important. Check your beneficiary designations. From your 401(k) to your life insurance policies, you want to know it’s headed to the right person. You don’t want to be surprised to find it’s going to an ex-spouse or someone other than you intend it for. Finally, do you have beneficiary designations on the three most common things to go through probate? If you don’t leave things to the right people, the state determines who gets your assets when you’re gone.
If you get these done, you’ll likely be feeling even better about your financial future this year. Which of these are on your to-do list?
[0:54] – What were the first three financial resolutions?
[3:00] – Save as much as you can as early as you can.
[7:11] – Are you taking advantage of systematic savings?
[12:36] – Have you done your annual net worth statement?
[19:17] – Have you checked your beneficiary designations?
“It’s the power of compounding. The more time you have, the more it’s going to grow before you start tapping it for your retirement income.“
– David Dickens