Simple Suggestions for Your Long-Term Financial HealthSubmitted by Washington Wealth Advisors | Falls Church and Ashburn, VA on May 11th, 2020
By Todd I. Youngdahl, CFP® and Maura C. Schauss, CFP®
ALWAYS spend less money than you make.
This may be the cornerstone of financial rules and it’s certainly the one that lends itself more to common sense. But as a society that thrives on material items and keeping up with our neighbors, it’s also one of the rules that is most frequently broken. That’s why the average credit card debt carried in U.S. households is up to $5,700. Stop worrying about what the neighbors have and start buying only what makes you happy.
This includes saving for an emergency as well as saving for retirement, because you need both. You need access to cash in the short term should you face the elimination of a job. You also need to start saving for retirement as early as possible, which gives your money the time it needs to grow. Start both today.
ELIMINATE all high-interest debt before you start to invest.
Any money you invest will be immediately offset by carrying high-interest debt, so aggressively paying you’re your debt will do more for your long-term financial health than investing will.
BUILD a budget and use it.
There are so many budget tools available that can be used on a smart phone or tablet that can help you keep track of your monthly income and expenditures. But using an Excel spreadsheet will work just as well. The important thing isn’t to just create the budget, but to actually use the budget. For instance, knowing how much you’ve spent eating out for the month will allow you to curtail any future plans if you’re close to exceeding your budgeting amount. It takes some time and effort to actually use a budget, but you’ll be surprised at how quickly it can make a difference.
PURCHASE a fuel-efficient vehicle.
Gas prices will most likely go up. Although not an option for everyone, consider the benefits of driving a mid-sized vehicle that can get 30 MPG and beyond, over a truck that gets 11 miles to the gallon.
STOP listening to product advertising.
Watching a kid’s cable channel opened our eyes to just how manipulative and sometimes false, advertising can be. Like anything else, advertisers work on emotion, and they do an excellent job of convincing us in 30 seconds that we absolutely need the product that they’re selling. Just stop listening and you won’t be tempted to buy something you have no need for.
Take inventory of what you can do and start simply. Your future self will thank you. If you are looking for a trusted partner to assist you along the way, connect with us. We are here for you and your financial peace of mind.
About Washington Wealth Advisors
Washington Wealth Advisors is an independent registered investment advisory firm serving high net worth families and small businesses. We focus on holistic financial planning and comprehensive investment management. Leveraging our core strengths of unbiased, active investment management together with a detailed annual financial planning capability, we serve your comprehensive investment and financial planning needs.
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