That’s not just your morning alarm, set for 6:15am each and every darn weekday.
It’s a starter’s pistol. The rat race has begun.
The rat race is a behavior experiment. Scientists condition rats to run races, solve puzzles, complete mazes, do tricks, reproduce, not reproduce, and a host of other feats.
How? By dangling a treat in front of them. Perform the tasks. Get the reward.
Many are caught in a human rat race. They’re told that to be an adult they need a credit card, a car, a mortgage, and a 9 to 5 job.
So they jump through the hoops, solve the puzzles, and perform the tasks to get that treat—their paycheck.
That paycheck gets consumed by their basic needs, their payment plans, and their lifestyle.
And the cycle continues. Jump through hoops. Get paid. Spend. Jump through more hoops. Ad infinitum.
Bigger “treats” help—like a bonus or a raise—but only for a little while. Eventually, they get consumed by increasingly extravagant spending. It’s why people with high incomes stay trapped in the rat race.
The result? You keep running a pointless and repetitive race that leads nowhere.
Is it any surprise, then, that there’s a “great resignation” happening? Or that businesses can’t find employees?
Maybe it’s because people are finally waking up to the truth—they’ve been playing someone else’s game. They’ve been making someone else rich. And now they’re ready for a new and better opportunity.
It was no 2020, thank goodness. But there were enough ups, downs, and head scratchers to warrant a retrospective.
These are the top financial literacy stories of 2021.
Memes rocked the financial industry. You read that correctly—memes.
It began with struggling companies like Gamestop and AMC soaring in value. The cause? Rabid speculation fueled primarily by Reddit. There was little rhyme and even less reason to the frenzy, with devastating results—the boom became a bust that wiped out $167 billion of wealth.¹
And notice, that’s not even counting the rollercoaster year that cryptocurrency enthusiasts have “enjoyed.”
Memes also literally became hot commodities in the form of NFTs (Non-Fungible Tokens).
What’s an NFT? In short, it’s an image that’s modified with blockchain. The blockchain makes the image a one-of-a-kind collector’s item since it’s possible to verify the image’s identity. Think of it as a mix of cryptocurrency and trading cards.
That means almost any digital image has the potential to become incredibly valuable. For instance, one NFT sold in 2021 for $69.3 million.²
And it makes sense why people have turned en masse to memes to build wealth. They don’t know how money works. They’ve never been taught how to build a financial legacy. And deep down, they know it. So when something, anything, comes along that looks like an opportunity to stick it to the man, they take it. The results are predictable… and often tragic.
The housing market caught on fire. Speaking of extravagant pricing, the housing market boomed in 2021. The numbers speak for themselves. Rent increased 16.4% from January to October.³ More dramatically, home prices surged almost 20% between August 2020 and August 2021.⁴
The housing market serves as a window into other forces impacting consumers. Inflation raised the cost of almost everything in the last half of 2021. And with the supply chain in chaos, it seems possible that prices will continue to rise in 2022.
That makes financial literacy more critical than ever. Families have less and less margin for error, and common milestones seem harder to reach. Without the right knowledge and strategies, building wealth may be increasingly difficult.
Financial illiteracy cost Americans billions. An annual survey by the National Financial Educators Council revealed that financial illiteracy cost the average American $1,634 in 2021.⁵ That’s a total of $415 billion.
Worst of all, that’s likely an underestimate. Think of what $1,634 could do if it were put to work building wealth in a business or retirement account. That’s the true cost of financial illiteracy—both in the short-term AND building wealth long-term.
What are your top financial literacy stories from 2021? Do you foresee any exciting changes in 2022?
¹ “Meme Stocks Lose $167 Billion as Reddit Crowd Preaches Defiance,” Sarah Ponczek, Katharine Gemmell, and Charlie Wells, Bloomberg Wealth, Feb 2, 2021, https://www.bloomberg.com/news/articles/2021-02-02/moonshot-stocks-lose-167-billion-as-crowd-preaches-defiance
² “Top 5 Non-Fungible Tokens (NFTs) of 2021,” Rakesh Sharma, Investopedia, Dec 15, 2021, https://www.investopedia.com/most-expensive-nfts-2021-5211768
³ “Biden’s next inflation threat: The rent is too damn high,” Katy O’Donnell and Victoria Guida, Politico, Nov 10, 2021, https://www.politico.com/news/2021/11/10/rent-inflation-biden-520642#:~:text=The%20Apartment%20List%20annual%20National,expected%20to%20continue%20for%20years
⁴ “Home price growth is finally decelerating—and it’s just the start,” Lance Lambert, Fortune, Dec 6, 2021, https://fortune.com/2021/12/06/housing-market-slowing-heading-into-2022/
What’s your favorite thing about the holidays? Maybe it’s family, tradition, generosity, or even nostalgia.
Your answer is a window into your values. That’s what makes the holidays so special—they’re opportunities to reconnect with what’s important to you.
But here’s the truth—that connection isn’t reserved for the holidays. In fact, it can be yours year-round.
This holiday season, make note when you sense that connection. Look for it while you’re celebrating holiday traditions with your family. Or notice someone’s expression when they open that gift, the one they’ve wanted for years. Or any child’s face when they’re mesmerized by the lights in the neighborhood.
Next, strategize about how you can have more of what you value in life. Maybe you need an opportunity that gives you more time with your family. Maybe you need an income boost to afford greater generosity. It’s likely that you’ll need to make financial moves in addition to personal moves.
Finally, follow through. That might involve taking massive leaps forward. It may involve a small, unassuming step. Whatever it is, start working towards that sense of connection.
So here’s wishing you a holiday full of what matters most. And may you have the courage to chase those things in the upcoming year.
You just need the practical know-how to overcome your fears and start the journey.
The goal of this article is to empower you to take bold action.
So turn off the YouTube self-improvement videos and fire up Google Docs. Here’s how to choose the right side gig for you.
Step 1: List your hobbies. Passions can make excellent side gigs. Why? Because they leverage skills you currently have, and are already commanding your attention and interest. Those are critical ingredients for success.
It doesn’t matter how niche or obscure your hobby might be. Write it down. In fact, the more oddball your interest, the more potential you may have to monetize it.
Step 2: Evaluate the market. Simply put, can your skills solve a problem for people? If so, then you have a potential client base at your fingertips.
Those problems may not seem obvious at first. But you may be surprised by what people will pay for your service or product.
Not knowing how to play an instrument is a huge roadblock for music lovers.
Lacking time to decorate, clean, and organize is a persistent dilemma for type A personalities.
Social Media illiteracy is a massive headache for older people starting small businesses.
All of those problems are opportunities to boost your income, if you have the skills to solve them. It just takes some time and creativity to identify problems.
Step 3: Size up the competition. But here’s the catch—there might be hundreds, or even thousands, of others seeking to solve the same problems as you. In fact, your competitors might already have a well-established grip on your target market.
However, if your skills or niche are highly specific, you could have a rare opportunity on your hands that no one is fulfilling, or that no one is fulfilling well. You could eventually scale your side gig income to replace your day job!
This leads to a critical principle for deciding which side gig is right for you…
Opportunity lies at the intersection of high demand and low supply.
The more people demand a service, and the fewer competitors already providing it, the greater your likelihood of success.
There’s just one factor left to consider…
Step 4: Weigh costs against rewards. Starting a business requires a combination of time, effort, and money. No exceptions. The question is whether—and when—the rewards will outweigh the costs.
Starting a car manufacturing business? Good luck—you’ll require a huge amount of capital, and won’t see profits for years.
Refurbing curbside furniture with tools and skills your grandpa left you? Hats off—your startup costs are almost zero, beyond some time and energy.
Which side gig fits these parameters for you? Whatever it is, let’s chat about it. We can discuss what it would look like for you to start pursuing it today!
What if you could get paid for doing something that you already enjoy doing? We’re all good at something. Many people have turned their hobbies into a side business as a way to earn extra money. For nearly everyone, there’s a topic they know well or a skill they have that many other people don’t have. That niche can spell opportunity – and a chance to turn something you enjoy doing anyway into a money-maker.
Depending on the type of hobby you want to monetize, your startup expenses may be quite low. For writing, coding, or graphic design, you might only need a laptop or tablet – something you may already have. If your hobby is fixing up old cars, however, you might need a place to do the work – possibly adding to the expense. For that scenario, you could check out the possibility of putting in a couple of Saturdays per month at a local shop to help save on rent and insurance costs.
With a little ingenuity, you might be able to earn $10 to $40 (or maybe more) per hour doing work you enjoy. Artists can earn extra money by selling arts and crafts items through virtual stores on specialized websites. Freelance writers, coders, designers, and even teachers can find work as well on similar type websites that bring clients and service providers together. If you have a knack for knowing what’s valuable, you may be able to turn garage sale and estate sale buys into a rewarding online business on any popular consumer-to-consumer and/or business-to-consumer sales website. (Hint: If this is something you’d like to try, start out small. Concentrate on one type of item that might be near and dear to you, like brass musical instruments, or antique mason jars.)
The old saying that asserts “knowledge is power” applies here as well. Let’s say your childhood fascination with dinosaurs never quite went extinct. Maybe there’s a successful educational blog or a YouTube channel in your future. Technology has given us the power to reach a larger audience than ever before and to bring our knowledge to anyone who wants to learn more. Sharing what you know can be monetized in many ways and – if you love doing it – you might not feel like you’re working at all!
Do your research and understand any legal or insurance requirements that may apply to the area you want to get into, but don’t let a little legwork bar the way to your next great endeavor – even if it just starts as a side gig.
You know how it works. If your guess is the closest without going over, you win the prize. And whether it’s a cash pot, a season pass for your hometown’s team – or even just the jellybeans themselves, it’s a situation with a lot at stake. You’ve been presented with a ripe opportunity to prove your keen intellect, not to mention maybe winning some free candy!
You may start pulling out your old high school algebra equations. You may laboriously count the visible jellybeans so you can extrapolate the total. You may even pick the jar up and hold it to the light – shaking it and assessing any gaps in area coverage.
Take your time. It’s a big decision.
Unfortunately for many people, it seems not as much thought goes into estimating how much a life insurance policy may cost. Can you guess how much a policy might cost?
LIMRA’s 2021 Insurance Barometer study shed a little light on just how off these guesses can be: When Millennials surveyed were asked how much they thought a healthy 30-year-old would pay for a term insurance policy, their median guess was $1,000 – more than 6 times the actual cost!¹
That stat is pretty revealing: odds are that the number you have in mind is a lot higher than what you might actually end up paying for your policy. As a result, it may feel like you’re saving money right now by not having life insurance. But in the case of a sudden illness, the passing of a breadwinner, or an unexpected loss of income, not having (what is potentially affordable) protection for your loved ones feels as silly as writing down a guess of 1,000,000 jellybeans next to the mathematician’s answer of 1,086.
The bottom line: Have you overestimated how much a well-tailored life insurance policy could cost you? Not sure? Reconsider your guesstimate with a financial professional who knows the in’s and out’s of your needs and what coverage may be available that fits your budget. (It’s like knowing how many jellybeans are in the jar before you have to guess!)
¹ “Top Misconceptions About Life Insurance,” LIMRA, https://www.limra.com/siteassets/research/research-abstracts/2021/2021-insurance-barometer-study/2021_barometer-infographic.pdf.
It’s official—Americans aren’t going back to work.
Even though there were 10 million job openings in June of 2021.¹
If you’ve been out and about, you’ve seen firsthand that jobs aren’t getting filled.
You may have noticed the signs at your local grocery store. Or the longer wait at your favorite restaurant. Or slower service from businesses you depend on.
They all stem from the same source. Americans aren’t rushing back to work.
But why? The COVID-19 pandemic caused mass unemployment and havoc for millions of American families. Wouldn’t they want to start earning money again, ASAP?
It’s not the unemployment benefits holding them back. Those dried up months ago, and the numbers still haven’t budged.
And again, it’s not that there aren’t jobs. There are millions of opportunities out there!
Here’s an idea—many people have woken up to the fact that most jobs suck.
Most jobs leave you completely at the mercy of your boss. If they mismanage the business, your job’s in danger. If you want a bigger bonus, your job’s in danger. If another pandemic breaks out, your job’s in danger.
They give you no control over your hours, your income, your location, or your future.
Who would want to go back to that?
Instead, Americans are looking for a better opportunity. They want control of their future, their wealth, and their hours. They want to replace the insecurity of a 9 to 5 with more reliable sources of income.
If they see an opportunity that checks those boxes, they’ll be willing to re-enter the workforce.
Americans are looking for a better path. The million dollar question is, who will provide it for them?
¹ “Many Americans aren’t going back to work, but it’s not for the reason you might expect,” Paul Brandus, MarketWatch Aug 14, 2021, https://www.marketwatch.com/story/many-americans-arent-going-back-to-work-but-its-not-for-the-reason-you-might-expect-11628772985
² “What states are ending federal unemployment benefits early? See who has cut the extra $300 a week,” Charisse Jones, USA Today, Jul 1, 2021, https://www.usatoday.com/story/money/2021/07/01/unemployment-benefits-covid-federal-aid-ending-early-many-states/7815341002/
But by definition, your job ceases to become your source of income once you retire.
Instead, you’ll need to tap into new forms of cash flow that, most likely, will need to be prepared beforehand.
Here are the most common sources of retirement income. Take note, because they could be critical to your retirement strategy.
Social Security. It’s simple—you pay into social security via your taxes, and you’re entitled to a monthly check from Uncle Sam once you retire. It’s no wonder why it’s the most commonly utilized source of retirement income.
Just know that social security alone may not afford you the retirement lifestyle you desire—the average monthly payment is only $1,543.¹ Fortunately, it’s far from your only option.
Retirement Saving Accounts. These types of accounts might be via your employer or you might have one independently. They are also popular options because they can benefit from the power of compound interest. The assumption is that when you retire, you’ll have grown enough wealth to live on for the rest of your life.
But they aren’t retirement silver bullets. They often are exposed to risk, meaning you can lose money as well as earn it. They also might be subject to different tax scenarios that aren’t necessarily favorable.
If you have a retirement savings account of any kind, meet with a licensed and qualified financial professional. They can evaluate how it fits into your overarching financial strategy.
Businesses and Real Estate. Although they are riskier and more complex, these assets can also be powerful retirement tools.
If you own a business or real estate, it’s possible that they can sustain the income generated by their revenue and rents, respectively, through retirement. Best of all, they may only require minimal upkeep on your part!
Again, starting a business and buying properties for income carry considerable risks. It’s wise to consult with a financial professional and find experienced mentorship before relying on them for retirement cash flow.
Part-time work. Like it or not, some people will have to find opportunities to sustain their lifestyle through retirement. It’s not an ideal solution, but it may be necessary, depending on your financial situation.
You may even discover that post-retirement work becomes an opportunity to pursue other hobbies, passions, or interests. Retirement can be about altering the way you live, not just having less to do.
You can’t prepare for retirement if you don’t know what to prepare for. And that means knowing and understanding your options for creating a sustainable retirement income. If unsure of how you’ll accomplish that feat, sit down with your financial professional. They can help you evaluate your position and create a realistic strategy that can truly prepare you for retirement.
This article is for informational purposes only and is not intended to promote any certain products, plans, or policies that may be available to you. Any examples used in this article are hypothetical. Before enacting a savings or retirement strategy, or purchasing a life insurance policy, seek the advice of a licensed and qualified financial professional, accountant, and/or tax expert to discuss your options.
¹ “How much Social Security will I get?” AARP, https://www.aarp.org/retirement/social-security/questions-answers/how-much-social-security-will-i-get.html
There’s no way to guarantee that it’ll pay off because there are so many unknowns that go into starting a business. But one thing is for sure: If you’re the adventurous type and aren’t afraid to give it your all, you won’t be able to resist the urge to try!
So if you’re thinking about entrepreneurship, here are some factors to consider…
Do you have enough experience in your field?
It’s a fact—entrepreneurs with at least three years of experience in their industry are 85% more likely to succeed.¹ If you haven’t met that threshold, you might not be ready for entrepreneurship just yet! Are you equipped to handle the stress?
Entrepreneurship can be intense. You’re going to be the one who has to problem solve payroll, bookkeeping, marketing, sales, customer service…the list goes on and on.
If you aren’t ready for this kind of pressure, entrepreneurship might not be for you. It may be better to begin developing stress coping strategies now that could serve you well if you pursue entrepreneurship in the future.
Have you developed a professional and personal support network?
Starting your own business is tough. Having a support network can make it easier. Without a positive, supportive circle (in person and online), you run the risk of…
People you know who have already started businesses are great contacts for advice. And if they’re extremely successful, they may even be willing to mentor you as well.
It’s also critical to surround yourself with inspired individuals who can support you in your moments of self-doubt or when you’ve had a failure. These are the people that can help you keep going when things get tough!
Are your personal finances in order?
If you’re paying off massive amounts of debt, have no savings, and are living paycheck-to-paycheck (or worse…borrowing from friends or family), entrepreneurship would likely stress your finances even more. How would you pay your rent or put food on the table if your business underperformed? That’s why it’s best to discover how money works before—not after—you start your business.
This article isn’t meant to discourage you from going out on your own and forging your own business path—entrepreneurship is an incredible opportunity to chase your dreams and build wealth! Rather, it’s supposed to help you succeed. The sooner you start addressing the factors in this article, the sooner you can start building the business you’ve always wanted!
¹ “The Average Age Of A Successful Startup Founder Is 45,” Entrepreneur Middle East, George Hojeige, Feb 5, 2020, https://www.entrepreneur.com/article/345884
And nothing screams normal like the office. The messy desks, the long commute, the last-minute requests from your boss, even those boring meetings—they all may appear oddly comforting after a year spent at home.
But beware. The return to normal might start off exciting, but you may find that the novelty is wearing off before too long. You might rediscover certain things about the 9-to-5 life that drag you down.
If that’s where you find yourself, mark it well. It may mean that your work location isn’t the problem—it’s the job itself.
That’s because it doesn’t matter whether you work from home or in an office if your career is being stifled by your job. A toxic work dynamic or disadvantageous model will drain you even if you’re working from a beach in the tropics!
So if you go back to the office and nothing changes, it may be time to find a new opportunity, one that offers…
So as you go back to the office, keep your eyes open. If you’re still dissatisfied with your job, contact me. We can explore opportunities for you to break the mold and pursue your own path.
One study revealed that 85% of self-made millionaires read 2 or more books per month.¹ That’s not a coincidence. Many of us have been told that reading improves our vocabulary and grammar skills, but there’s so much more to it than that! Reading can help develop traits that can provide an excellent foundation for a prosperous life and building wealth.
1. Reading expands your perspective. Think of it like a hack that grants you access to the wisdom of others. Instead of only drawing from your own experiences and resources, reading is an opportunity to discover fresh and challenging ideas. And the more connections you make between the ideas you read about, the more creative—and valuable—you become.
2. Reading can counteract negative emotions. Reading is good for your brain—it can reduce stress levels and prevent age-related cognitive decline.² But it goes deeper than that. It turns out that making new connections is good for your mental health. There’s evidence that reading can help combat struggles like depression.³
Why? It’s because reading can help people process difficult situations. Reading about other characters and different perspectives can help forge new mindsets and beliefs. And the more you process through difficulties, the better equipped you become to build a prosperous life.
3. Reading builds empathy. It’s no surprise that discovering other perspectives or exploring the inner lives of characters builds empathy.3 What might be surprising, however, are empathy’s benefits.
Not only does empathy lead to a richer emotional life, but it’s been shown to be critical for creating healthy—and productive—workplaces.⁴ Understanding the emotions and feelings of others makes you a more effective leader, coworker, and person.
Notice that none of these skills are directly financial—you won’t learn them in a finance or accounting course, and probably no one would pay you to read a book per month. But, as you can see, they can be critical for expanding your perspective and growing your career.
If you’re interested in reading more, start small and easy. Try reading for 15 to 30 minutes per day for a week on a topic that interests or excites you. Then slowly expand your reading time as you feel comfortable. At the end of the month, see how you feel! You might be surprised by how much your perspective has grown or shifted.
¹ “5 Common Traits of A Self-Made Millionaire,” Caden Strause, Medium, Oct 26, 2020, https://medium.com/frugal-friday/5-common-traits-of-a-self-made-millionaire-f6cf65c13c6c
² “5 ways reading benefits your health — and how to make reading a daily habit,” Lia Tabackman, Insider, Dec 1, 2020, https://www.insider.com/benefits-of-reading
³ “The Health Benefits of Books You Have to Read to Believe,” Madison Yauger, Shape, Oct 27, 2020, https://www.shape.com/lifestyle/mind-and-body/benefits-of-reading-books
⁴ “New Research Shows Why Business Leaders Struggle With Workplace Empathy,” Bryan Robinson, Forbes, May 17, 2021, https://www.forbes.com/sites/bryanrobinson/2021/05/17/new-research-shows-why-business-leaders-struggle-with-workplace-empathy/?sh=749a6d8684ad
But sometimes it might seem more convenient (or economical) to rent rather than buy. Here are two things to consider if you’re looking to buy a house instead of renting.
How long will you live in the house?. When you own a home, the hope is generally that it will increase in value and that you would be able to sell it for more than you bought it. The best way to do that is to plan to stay in your house for the long haul. So if you’re looking to remain in an area for a while and put down roots, buying a house is a strong consideration.
But let’s face it, not everyone is in that position. Maybe you’re young and hopping from opportunity to opportunity. Perhaps your job requires you to travel frequently or change locations. You might just prefer discovering new, exciting places and not being tied down. Unless you plan on renting out your property, it may not make sense for you to buy. Renting might give you more flexibility to move about as you please!
Can you afford to buy a house? So you want to settle down in a city or a certain neighborhood for the foreseeable future. Does that automatically mean you should buy a house?
Well, maybe not.
You simply may not be able to afford a house right now. Do you have significant debt in student loans or a car? Have you been able to save up enough for closing costs and a down payment? Mortgages might be cheaper than rent at certain times, but that might flip-flop before too long. Are you ready to maintain your house or pay for unexpected damages? These are all questions to ask before you decide to become a homeowner.
Still weighing your homeownership options? Let’s talk. We can review your situation and see if now is your time to buy!
The good news is, you don’t need a perfect relationship or perfect finances to have productive conversations with your partner about money, so here are some tips for handling those tricky conversations like a pro!
Be respectful. Respect should be the basis for any conversation with your significant other, but especially when dealing with potentially touchy issues like money. Be mindful to keep your tone neutral and try not to heap blame on your partner for any issues. Remember that you’re here to solve problems together.
Take responsibility. It’s perfectly normal if one person in a couple handles the finances more than the other. Just be sure to take responsibility for the decisions that you make and remember that it affects both people. You might want to establish a monthly money meeting to make sure you’re both on the same page and in the loop. Hint: Make it fun! Maybe order in, or enjoy a steak dinner while you chat.
Take a team approach. Instead of saying to your partner, “you need to do this or that,” try to frame things in a way that lets your partner know you see yourself on the same team as they are. Saying “we need to take a look at our combined spending habits” will probably be better received than “you need to stop spending so much money.”
Be positive. It can be tempting to feel defeated and hopeless that things will never get better if you’re trying to move a mountain. But this kind of thinking can be contagious and negativity may further poison your finances and your relationship. Try to focus on what you can both do to make things better and what small steps to take to get where you want to be, rather than focusing on past mistakes and problems.
Don’t ignore the negative. It’s important to stay positive, but it’s also important to face and conquer the specific problems. It gives you and your partner focused issues to work on and will help you make a game plan. Speaking of which…
Set common goals, and work toward them together. Whether it’s saving for a big vacation, your child’s college fund, getting out of debt, or making a big purchase like a car, money management and budgeting may be easier if you are both working toward a common purpose with a shared reward. Figure out your shared goals and then make a plan to accomplish them!
Accept that your partner may have a different background and approach to money. We all have our strengths, weaknesses, and different perspectives. Just because yours differs from your partner’s doesn’t mean either of you are wrong. Chances are you make allowances and balance each other out in other areas of your relationship, and you can do the same with money if you try to see things from your partner’s point of view.
Discussing and managing your finances together can be a great opportunity for growth in a relationship. Go into it with a positive attitude, respect for your partner, and a sense of your common values and priorities. Having an open, honest, and trust-based approach to money in a relationship may be challenging, but it is definitely worth it.
You know, one where you felt as if all your energy was being drained from the moment you walked in until the moment they kicked you out. Maybe it was a bad boss, or just something about the industry or type of work.
This article will help you evaluate whether or not your current career path is worth pursuing by considering the opportunity cost of staying where you are versus leaving to pursue your dreams.
First off, what is opportunity cost? It’s an economic term which refers to the benefit that a person must give up in order to attain something else. Typically, it’s calculated in dollars. For instance, career A might pay you $50,000 while career B may pay only $30,000. The opportunity cost of choosing career B would be $20,000.
But here’s the catch—there are factors beyond pay that you must consider when choosing a career.
What if earning boatloads in your career requires dedicating all your waking hours to that endeavor? Are you sacrificing your joy, freedom, or even mental health just for a paycheck? The opportunity cost of your career and salary might be your joy, your freedom, your family, and your state of mind!
So when considering a job or a career, weigh ALL the costs. Will your career consume your time, distract you from your true passions, and impair your mental health, all in exchange for a fat paycheck? Or will it enrich your life, use your time wisely, and allow you to make enough money without sacrificing the joys of family and friends?
You have a chance to make your life even better with this gift. However, it’s important to handle it wisely so you don’t create any regrets down the line!
Pay down debt. Receiving a sudden windfall is the perfect opportunity to take a chunk out of any credit card debt or student loans that are hanging over you. You may even be able to pay off your car or house!
The simple fact is that debt wears down your ability to build wealth. Using your inheritance to help pay off your loans can position you to start building wealth sooner rather than later.
Build your emergency fund. Having cash on hand can be a game-changer. It empowers you to tackle emergencies like a child’s broken arm, an unexpected car repair, or even short-term unemployment—without turning to debt.
If you don’t have three months of expenses saved, consider using your inheritance to create some financial peace of mind for your family by setting up an emergency fund.
Save for retirement. Now that you’ve covered your bases, you can start using your inheritance to start building wealth for the future. As soon as you can, meet with a licensed and qualified financial professional to start developing a strategy that will make your money work for your future!
Fund your kids’ college education. College is pricey. Whether your children are very young or almost at university age, now is a good time to start saving for college. Once again, it’s best to meet with a financial professional to decide the best way to go about funding your child’s education.
Finally, have fun! You’ve done the hard work of getting rid of debt and building your emergency fund. Now that you have a college education and/or your retirement savings strategies in place, there’s no reason not to splurge on something fun with your inheritance! Just be sure that your fun doesn’t send you back into debt or dip into your emergency fund!
You get to relax and do whatever you want, whenever you want, with whomever you want. But it’s important not to forget about your finances AFTER retirement; here are wise financial moves that retirees should consider once they decide to quit working for good.
Get your will in order. You’ll be ahead of the game if you do—68% of Americans have no estate plan in place!¹ The simple truth is that preparing a will can help ensure that your money goes where you want it to go and save your family a financial headache. If you’re retired and haven’t created a will, do it today!
Plan for long-term care expenses. Why? Because there’s a strong chance you’ll need it—60% of people will need some form of LTC in their lives.² And it can be costly, possibly running into the tens of thousands of dollars. If you’re about to retire or have already retired, consult with a licensed and qualified financial professional about your options for this critical line of financial defense.
Pay off your mortgage! And, if you’ve played your cards correctly, you should be close to paying off your mortgage by the time you retire. Eliminating your home payments may free up a considerable amount of cash for you to spend on your other bills and your retirement lifestyle.
Consider downsizing your home to a smaller property or RV. That is of course, unless you have a huge family you regularly plan on entertaining! But for many, retirement is a perfect opportunity to move into a smaller, easier to manage home.
And if you’re the adventurous type, why not buy an RV? It’s a great way to travel and explore the country now that you’re moving into a new phase of life.
If you’re retiring, it doesn’t mean there aren’t a few key money moves left to be made. Consider these suggestions to be the cherry on top of your years of diligent work and savvy saving!
¹ “68% of Americans do not have a will,” Reid Kress Weisbord, David Horton, The Conversation, May 19, 2020, https://theconversation.com/68-of-americans-do-not-have-a-will-137686
² “What is Long-Term Care (LTC) and Who Needs it?,” LongTermCare.gov, Jan 4, 2021, https://acl.gov/ltc
But when your budget is already tight, they might be hard to find! Read on for 5 simple strategies to save money that may surprise you…
Cook your own food instead of eating out. Eating at a restuarant is about 300% more expensive than cooking at home. For instance, a $12 dollar burger at your favorite spot would cost $4 to prepare in your kitchen.¹
The takeaway is clear—whenever possible, prep your own food. Search the internet for recipes you love, recruit friends and family, and start creating… and saving!
Use coupons and promo codes. There are two ways to take advantage of online coupons and offers.
First, download your favorite grocery store’s app. Look for the savings section and start clipping coupons to your phone. Simply scan the app the next time you buy groceries for some potentially serious savings.
Second, install a plugin, like Honey, onto your browser. It will seek out coupons and promo codes and automatically apply them to your online purchases!
Walk and bike whenever possible. Any opportunity you have to replace your car with your feet or pedals, take it. Doing this has the potential to save you money on both gas and repairs over the long haul. Taking public transportation can also be a wise move—it’s been shown to save $10,000 per household.²
Make your own coffee at home to save money on daily expenses. Making your coffee in a traditional coffee pot can potentially save you over $1,900 annually.³ There’s nothing wrong with splurging on a coffee shop drink every now and then. But try to incorporate brewing your own coffee into your daily routine and see how it impacts your savings.
Find free entertainment. It’s not impossible! Organize a group of friends to throw a frisbee or play tag football in a park. Visit a museum with your family on a free-entry day. Go for a long walk with your partner. You might be surprised by how much fun you can have for free.
Apply these tips and let me know how much you save! What are some money saving ideas you use when you’re on a tight budget?
¹ “The True Cost Of Eating Out (And How To Save),” Amy Bergen, Money Under 30, Feb 11, 2021, https://www.moneyunder30.com/the-true-cost-of-eating-in-restaurants-and-how-to-save#:~:text=By%20contrast%2C%20the%20average%20meal,%244%20meal%20you%20prepare%20yourself.
² “Public Transportation Facts,” American Public Transportation Association, https://www.apta.com/news-publications/public-transportation-facts/#:~:text=Public%20Transportation%20Saves%20Money&text=A%20household%20can%20save%20nearly,living%20with%20one%20less%20car
³ “Here’s How Much Money You Really Save by Making Coffee at Home,” Samantha Rosen, NextAdvisor, February 3, 2021, https://time.com/nextadvisor/banking/savings/save-money-by-making-coffee-at-home/
Whether you’re a highschool student working a cash register or a fresh-out-of-college graduate who just landed a cubicle, a first job often comes with a steep learning curve. But don’t let that weigh you down! This is your once in a lifetime opportunity to start your financial journey strong and develop skills that will last you throughout your career.
Here are two simple steps you can take to make the most of your first job.
Start saving. A first paycheck is a magical thing. It makes you feel like the hard work has finally paid off and you’re a real adult. You might just become unstoppable now that you’ve got a regular income!
But that empowerment will be fleeting if you spend everything you earn.
It’s absolutely critical that you begin saving money the moment your first paycheck arrives. This practice will go far in establishing healthy money habits that can last a lifetime. Plus, the sooner you start saving, the more time your money has to grow via compound interest. What seems like a pittance today can grow into the foundation of your future wealth if you steward it properly!
Evaluate your performance. There’s much that you can learn about yourself by studying your job performance. You’ll get an idea of strengths that you can leverage and weaknesses that you need to work on.
But most importantly, you might discover moments when you’re “in the zone”. You’ll know what that means when you feel it. Time slows down (or speeds up), you’re totally focused on the task at hand, and you’re having fun.
That feeling is like a compass. It helps point you in the direction of what you’re supposed to do with your life. Do you get in the zone when you’re working on a certain task? With a group of people? Helping others succeed? Pay close attention to when you’re feeling energized at work and delivering quality results… and when you’re not!
Above all, keep an open mind. Your first job might introduce a passion you’ll pursue for the rest of your life… or it might not. And that’s okay! Whatever it is and wherever it leads, be sure to save as much as you can and to pay attention to what you like. You’ll be better positioned both financially and personally to pursue your dreams when the time comes to make your next move!
There’s something liberating about closing one chapter of your life and beginning a new one. You realize that this year doesn’t have to be like last year, and that there are countless possibilities for growth.
Now is the perfect time to write a new financial chapter of your life.
In the mindset of new beginnings, the first thing is to forgive yourself for the mistakes of the past and start fresh. Now is your chance to set yourself up for financial success this year and potentially for years to come. Here are three simple steps you can take starting January 1st that might make this new chapter of your life the best one yet!
Automate wise money decisions ASAP. What if there were a way to go to the gym once that somehow made you steadily stronger throughout the year? One workout would be all you need to achieve your lifting goals!
That’s exactly what automating savings and bill payments does for your finances.
All you have to do is determine how much you want to save and where, set up automatic deposits, and watch your savings grow. It’s like making a year’s worth of wise financial decisions in one fell swoop!
Give your debt the cold shoulder. Debt doesn’t have to dictate your story in the new year. You can reclaim your cash flow from monthly payments and devote it to building wealth. Resolve to reduce how much you owe over the next 12 months, and then implement one of these two powerful debt strategies…
Arrange your debts on a sheet of paper, starting with the highest interest rate and working down. Direct as much financial firepower as you can at that first debt. Once you’ve cleared it, use the extra resources you’ve freed up to crush the next one even faster. This strategy is called the Debt Avalanche.
Arrange your debts on a sheet paper, starting with the smallest debt and working up to the largest. Eliminate the smallest debt first and then work up to the largest debt. This is called the Debt Snowball. It can be a slower strategy over the long-haul, but it can sometimes provide more motivation to keep going because you’re knocking out smaller goals faster.
Start a side hustle. You might not have thought much about this before, but you may have what it takes to create a successful side hustle. Just take a moment and think about your hobbies and skills. Love playing guitar? Start teaching lessons, or see if you can start gigging at weddings or events. Are you an embroidery master? Start selling your creations online. Your potential to transform your existing talents into income streams is only limited by your imagination!
Start this new year strong. Automate a year’s worth of wise financial decisions ASAP, and then evaluate what your next steps should be. You may even want to meet with a qualified and licensed financial professional to help you uncover strategies and techniques that can further reduce your debt and increase your cash flow. Whatever you choose, you’ll have set yourself up for a year full of potential for financial success!
Setting goals has the power to change your life. Research has shown that people who write down their goals are 33% more successful in accomplishing them than those who don’t.¹ That data seems to verify what we instinctively know. Is there anything worse than working on a project that has no clear objective or outcome defined?
But here’s the million dollar question: Have you written down your financial goals?
It’s one of those simple things that we tell ourselves we’re going to do or that we’ll get around to later, but we tend to leave undone. And that results in our earning, saving, and spending money aimlessly, without purpose. No wonder the majority of 40-somethings and almost a third of people in their 60s are woefully short of having enough for their retirements!²
In case you still need convincing, here are three reasons why you should write down your financial goals the second you’re done reading this article!
Financial goals bring clarity. Imagine trying to build a house without a blueprint. Where would you start? Would you know what supplies you’d need? What color paint you’d want? Would you end up with a basement? Who knows?
Your finances are the same way. Until you have a clear financial goal for your lifestyle and retirement, you’ll never truly know what to do with your money and how it can help you. Once you’re locked in on a vision of your future, you can start exploring the actions necessary to make your dreams become realities.
Financial goals create intensity. Discovering the steps you need to take to achieve your goals cuts away distractions. You’re no longer as susceptible to distractions and temptations because you’re laser-focused on creating an outcome. You can focus all of your mental and financial energy on bringing your vision to life. Clarity leads to focus. Focus creates intensity. Intensity accomplishes goals.
Financial goals are rewarding. There are few better feelings than the one that comes after a day of hard, productive work. That’s because your brain knows that you accomplished what you set out to do.
Your finances are no different.
Setting goals for your money gives you the opportunity to feel that deep sense of reward and accomplishment. It provides your life with a source of gratification that isn’t shallow and instantaneous.
So what are you waiting for? Grab a piece of paper or pull up your note taking app and write down a few financial goals! Be realistic and hyper specific. Let’s talk about what comes to your mind and what it would take to bring that vision of your life into reality!
¹ “Goal-Setting Is Linked to Higher Achievement,” Marilyn Price-Mitchell Ph.D., Psychology Today, Mar 14, 2018, https://www.psychologytoday.com/us/blog/the-moment-youth/201803/goal-setting-is-linked-higher-achievement
² “Here’s how much Americans have saved for retirement at different ages,” Kathleen Elkins, CNBC Make It, Jan 23, 2020, https://www.cnbc.com/2020/01/23/heres-how-much-americans-have-saved-for-retirement-at-different-ages.html