Financial Tips to Know Early in Life
Over the years our clients have made comments about financial decisions or actions they wish they had taken earlier in life. These financial tips to know early in life were compiled into a series of If I Knew This financial advice tidbits. Most often it is our soon-to-be retirees or retirees reflecting on their early career years that share these thoughts.
Our clients are hard-working individuals who have achieved great successes, however, in hindsight they feel they could have done more if they had started sooner with the guidance of a financial planner. The If I knew This Series for young investors was developed from actual client reflections with the hope of encouraging young investors to take action now. We hope you find these financial tips insightful and useful.
Tip #1: Credit Cards
- If I Knew This in My 20’s
- Paying off my credit cards in full and on time each month meant not wasting money on interest charges, late fees and penalties. I wish I had understood the cost of borrowing and lived within my means. WPC can guide you in setting up a realistic spending plan and savings plan to help you avoid debt.
Tip #2: Budgeting and Saving
- If I Knew This in My 20’s
- Sticking to a budget and saving first! I wish I had found a way to live on $50 less a week and contributed that to my Roth IRA early then increased to the maximum allowed as my salary grew over the years. If I had made this a goal and contributed consecutively for the first 25 years, I could have retired with almost a million dollars. WPC can teach you the benefits of saving and investing in a Roth IRA, so you harness the power of compounding.
Tip #3: Life Insurance Needs
- If I Knew This in My 30’s
- Buying term life insurance could have provided me peace of mind through all of life’s phases. I would have checked it out. Considerable worry can be removed from the equation with a quick medical exam, underwriting and affordable premiums. I wish I had considered the asset protection and liquidity of life insurance before I was deemed uninsurable. WPC can assess your life insurance needs and recommend suitable coverage.
Tip #4: Investment Mix
- If I Knew This in My 30’s
- Saving is good, but investing is better! I should have had an appropriate investment mix instead of hoarding cash. I should have learned how to allocate properly among different investments for short and long- term needs. I wish I had taken more risk early on so I could have cut off years of working later. WPC can build you a financial plan pointing you in the right direction with a suitable investment allocation.
Tip #5: College Savings and Investing
- If I Knew This in My 30’s
- My kid’s college education should have been tackled by saving early into a 529 plan. Even small amounts saved had time to grow tax-free and would have saved me taking out a second mortgage or cutting back on my own retirement savings in later years. WPC can help you have college paid for before your child graduates from high school.
Everyone’s situation is unique and presents different challenges and opportunities. Let us know if we can guide you in your financial decision making. Check out our helpful checklists and resources.
The advisors at Wealth Planning Corporation have been planning, coaching, and advising clients for successful retirements since 1984. We have 40 years of experience planning for life’s events and ultimately preparing clients for retirement. Learn more about our team and services at www.wealthp.com
