1. Invest Now. Even if you start saving $5.00 a week or $100 dollars a month, for the next 20 – 40 years you will have generated large sum of money. You will have a lot more in savings than if you have just started investing in the last 10 years. The reason why is, that compound interest gives you the helping hand that you need.
Rule is: Start early in your working life. Encourage your children to put away part of their pocket-money in an investment account. It is a great habit to get into.
2. Pay yourself first. You have probably heard this many times. It means before you pay anything, put that investment money away into your account. Pay everything else out of what is left. Have the investment portion of your income automatically taken from your paycheck and put into your investment account.
The saying is what you don’t see wont hurt.
3. Keep away from High interest on debt. That means get the lowest interest rate credit card that you can get, if you must have one. If you are sticking to a debit card for your transactions that is wonderful. “The only problem is that Debit card transactions are not reported to the credit bureaus so if you don’t us your credit card you will have less payment history – which hurts your FICO credit score” Suze Orman.
You only need to use your credit card every few months to keep your FICO in good shape. You may never borrow again, but it is a good back up just in case. Your FICO score can affect auto insurance premiums and in some cases wether a landlord will rent to you. Some employers will also check when vetting job apllications. It appears that credit unions generally have the lowest interest on cards. You can go to creditcardconnection.org
4. Check your insurance. Do you need the policy you have. You generally need Health, disability and term insurance. Life insurance is one that I believe you need while your children are young. As you get older and financially established, I don’t think life insurance is of any use, especially if your dead. You can better use that money in your investment account. Extended warranties and investment linked policies are also believed to be not a good investment.
5.Budget. Keep track of your expenses. I know the iphone has a budget application on it so that you can put your expenses down immediately so it’s not forgotten. A budget gives you a record of what you are spending and where. It is suprising how much you can save or do save by doing this one thing. You will be amazed at how you can survive on less.
6. Invest in anything – something. The banks – not a good idea. Your money will get chewed up with bank charges and basically zero interest on your money. Find someone to lead you in the right direction. Bonds, Stocks, investment funds. You can also join investment clubs that will teach you more on the subjects.
7. Have an emergency fund. If you get into a situation where you need cash quickly, having a fund for those times is such a good idea. Usually it will cost, to get money out of any investment before its due date and often will take a few days. To have a cushion fund is an excellent idea.
8. Always keep up with the news on the economy. Learn the tell-tale signs of good and bad investments. I listen everyday, I make my own mind up, as sometimes you have to separate the propoganda from the truth. In this economic time I think we need to be very aware of what is going on. Move your money if you are not comfortable. Get some advise on the subject before you do though. Second opinion is always a good thing.
9. Take time to think about large purchases. For large purchases take a week at least to make your decision. You may find that after that time you really don’t need it or don’t desire it anymore.
10. Tax. Go to someone professional and find out where and how you can reduce your tax. Most people don’t take the time but it can be worth it. You maybe surprised what you are able to claim.
For more saving information: Simply Fantastic – Living Better On Less
Teach your children when they are young to spend less, live on less.
“If you don’t do different nothing will change“