CNBC posted an article online yesterday about how to collect social security. It’s over simplified and generalizes the issues and concepts. The interesting part was the number of comments the article received. Close to 600 comments over the last 36 hours! It was scary to browse through these comments to see all the misinformation that was being spread among the commenters.
If you’re thinking about Social Security, or have questions, talk to us. We can help to think through the issues with you and help you avoid some of the common mistakes folks make.
Graduating from college can be as much a source of anxiety and dread as it is pride and joy—even students leaving the harshest, most exacting academic programs can feel some level of worry about the future stretching out before them. But fear not—our step-by-step guide will ease the burden by helping you get your financial life in order and engage the ‘real world’ on your own terms.
Make a budget you can live with.
Budgets are the core of financial planning, so that’s where you should start. Don’t fall for the trap so many young people do; saving doesn’t have to be all or nothing; if your current financial situation only allows for minor savings, that’s still better than not saving at all. Create a budget you can live with, with proper allowances for entertainment AND saving, then stick with it. And don’t forget, the little expenses add up over time!
You might be tempted to delay saving for your future (a house, or retirement) until you get a raise in a few years. That’s a trap. Take advantage of employer match in a 401(k). The compounding effects that happen by saving early will help you tremendously in the future.
Start paying your loans down quickly.
If you’re lucky enough to lock in a loans with low interest, it’s ok to pay the minimum amount. But if you have private student loans, or loans with high interest rates (more than 5%), consider paying them off sooner—the faster you clear them from your ledger, the better off your finances will be moving forward. We can help to advise you on the most appropriate strategy.
Put together a career development strategy.
When you’re young, your career serves as the vital engine driving any financial planning you make—so make sure you’re making the most of yourself. Figure out where you want to be and how you intend to get there, then start making it happen.
Start keeping yourself informed.
The last step of getting your financial life is one which lasts forever: Get informed, stay informed. You’re participating in the financial world now, so keep tabs on it: talk to a financial advisor, subscribe to a finance blog, and pay attention.
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The Danger of Taking Too Much
At least once a week, a client will give me a reason why they don’t want to invest in the US stock market. They mention the headlines (which are designed to scare investors), and talk about the crisis-du-jour, or reference the looming economic dark clouds growing in the distance.
And so they sit in cash, with its perceived safety, waiting for the dust to settle, the clouds to clear, and the right time to invest.
But will it ever come… will it ever be so clear to the investor as to when they should invest?