steve rice: 5 tips to avoid personal finance pitfalls
TRANSCRIPT
5 T I P S T O AV O I D P E R S O N A L F I N A N C E P I T FA L L S
C R E A T E D B Y S T E V E R I C E
• Managing personal finances is a skill that not all possess.
• Such a simple concept when ignored can damage more than your weekly spending allowance.
• Spending without proper precaution will affect your future, preventing you from achieving the goals you’ve worked so hard to earn.
• By following the simplest of steps, you can better protect yourself and your wallet from the allure of overspending.
• When shopping, purchase with your budget and not your eyes.
• It’s easy to see that new television or car as an acceptable loss, but those expenditures add up quickly.
• Everyone likes something new, but it’s not always the best choice when living under a budget.
• If you’re looking to purchase something in the near future, saving is always the best option.
• Set a goal and work toward it.
• With each milestone met, reaching your desired outcome will only feel sweeter.
• Building and maintaining an emergency fund is not only a good idea, it’s a necessity.
• Beyond covering yourself for the unexpected, a backup or emergency fund is “found money.”
• Car breaks down while you’re working toward putting a down payment on a house?
• Your well fed emergency fund will manage the hit while your plans continue, unhindered.
• However, your emergency fund is not for use on everyday purchases.
• If you can’t afford it without dipping into your backup funds, then reconsider purchasing the item at all.
• Learn all you can about your taxes, and more importantly your tax exemptions and refunds.
• Every dime you make passes through a minefield of percentiles levied by your state and federal government.
• Understanding where that money goes come tax season prevents you from leaving money on the table or losing more than necessary.
• If research doesn’t cut it, don’t be afraid to consult a professional.
• It’s their job to understand the tax world, and they may be able to find you exemptions that you’d have missed.
• Ultimately, creating this budget is to preserve your financial future.
• Part of ensuring your relative comfort is making sure you pay into your retirement fund.
• Maintaining a 401k is an absolute must.
• Over the years, it’s tempting to dip into the money you’ve accumulated, but think of it as a pennies in an unbreakable piggy bank.
• This money is more important than your emergency fund, because it’s meant to support you when you’ve retired.
• No one wants to work well into their 70’s, and maintaining a strong 401k will keep that from happening.
• Lastly, be sure to “pay yourself.”
• Saving with no concept of reward will eventually lead you to resent your efforts.
• Save money, spend responsibly but allow yourself some freedom.
• There is no sense in strangling yourself with a self-imposed budget.
• This is by no means permission to avoid the aforementioned financial planning, but it affords you some freedom without sacrificing the simple joys in life.