Showing posts with label financial freedom. Show all posts
Showing posts with label financial freedom. Show all posts
Wednesday, March 3, 2010
Getting a Head Start: Saving for Retirement Early On
5:59 PM | 
Posted by
Rebecca Bailey
The opportunity to enjoy life and to be financially free is for everyone to experience at every age. But how do you begin to excel at something you don’t understand? Do it in the same way you do now--learn, take action and keep the momentum going.
How do you prepare for your financial future? The answer is easy: it’s done the same way in which you began your college career and how you will find your dream job: by becoming informed and taking action. Begin with assembling helpful resources, leverage your network and then invest in your future. This month we’ll focus on what perspective you must have in order to craft a financially successful life.
First, why are you in college? Most students attend school in order to prepare for a life doing something they love. And why do we work? To leave a legacy, to enjoy ourselves and to earn money. Money allows us to afford opportunity.
With finances, it’s easy to rob ourselves of opportunity by making the wrong decisions, delaying action and not leveraging our resources. There’s something very critical that’s coming down the pipeline: two thirds of Baby Boomers don’t have enough time left to be able to save up enough to retire. That’s two out of three of your or your friend’s grandparents! Why is that? The high numbers almost don’t make any sense. They had the same tools available to them as you do today.
One answer to this issue is that many Baby Boomers didn’t start contributing to their retirement early enough to allow compounded interest to work in their favor. But it can for you. You’ve got the benefit of many years ahead of you to create financial sustainability for your future self. The sooner you start, the more time the compounded interest has to accrue. Though retirement might seem as far away as the moon, it's closer than you think. We need to shift the paradigm about when is the right time to start saving for the future. It’s easy to think that retiring is for elders and since you’re not “old” it’s not for you to consider at this time in your life...except it is. Start early and leverage your time to your advantage.
Retirement is for everyone. We all face it and we all should be planning for it as soon as we start working.
Whichever life path you choose, I guarantee you, your career ends best when you are financially free and empowered!
By Onna Young
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Monday, January 4, 2010
Smart Money with our Personal Finance Guru
Hello, Rainmakers! It's spring time and the world seems new again. As we progress in to the warmer months, I'd like to remind you that it's more than possible to be financially empowered, live a life you love and have fun! As the Rainmaker Network’s debt expert, I’ll be blogging about all things debt- and money-related to help you gain control of your finances.
So let’s start this year with some dos and don'ts about saving your money.
The first thing to ask yourself is, "How are my finances right now?"
If you don’t know the answer to this question, how will you know where you need to go and how to get there? So, to begin your quest towards financial freedom, let’s figure out where you are.
Tip #1: Analyze your expenditures
Where does your money go? Seems like a simple question, but many people are wholly unaware of where they spend their money. Perception and reality are often very different from one another.
Awareness is key. Begin keeping a daily or weekly log of all the money you spend on EVERYTHING. Analyze it weekly or monthly and categorize expenditures by necessities and extras. Consider the extras that might be draining your savings.
For example, if you’re buying a Starbucks coffee or a bottled water every day, consider bringing your own water in a metal container (some plastic containers contain harmful PCBs, which are especially bad for women) and/or your own coffee in a thermos. Filtered tap water is as good and clean as bottled water, and you could save considerable sums of money in the process. Think of it this way - if you took a 5 minute, 20 gallon shower with bottled water that costs roughly $3 per 16oz., that one shower would cost $480!
Your monthly water bill is probably $60.00/month for all the showers, water, cooking, and outside watering that you require - hundreds of gallons of water at pennies compared to what bottled water will cost you at a store. It’s more expensive than gasoline!
Saving that $5.00-10.00/day on water and coffee alone adds up to $35-70 dollars per week and $140 – 280/month. That's real savings!
Tip #2: Make a budget
Once you have a sense of what you're spending each month, put together a budget, even if it's a simple one, and make every attempt to stick to it.
Tip #3: Pay bills on time and in full
This is a great way to avoid late fees in general, but more importantly, if you use a credit card to make purchases, you can avoid paying exorbitant amounts of interest on your outstanding balance if you pay off your credit card bills in full. We all know that this isn't always possible (you really needed that new pair of shoes), but if you can keep the outstanding balance as low as possible month to month, this is a great start.
Tip #4: Make food at home and bring it with you.
Just as bottled water and coffee can add up, food can add up even faster over the course of multiple meals during the day.
Tip #5: Share the bill with friends.
Generosity is wonderful, but not always necessary.
Tip #6: Pay yourself
Consider paying yourself 10% of your income, whatever that might be. Even small increments of money add up over weeks and months. A good rule of thumb is to have 6 months worth of reserves in the bank at any given time in order to cover emergencies that might otherwise leave you stressed and scrambling for cash.
Making incremental changes to your finances will help put you on more solid financial footing so that you end up where you want to be. Happy New Year, and we look forward to helping you achieve a financial life that you love!
Written by Onna Young, TRN's Personal Finance Guru
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