In today episode you will learn what are the most important actions that you can take today and as you go forward in order to provide you a life you desire.  The flexibility, confidence, and freedom to do what you want.  To live that fulfilling life you have always desired and deserve. 

Show Notes:

Making your finances a priority early in life

  • Have compounding interests be on your side.  The earlier the better.  Sacrifice a little today for a better tomorrow.  
  • The rule of 72.  The Rule of 72 is a way to determine how long an investment will take to double. By dividing 72 by the annual rate of return, you can obtain how many years it will take for the initial investment to duplicate itself. Example is a 9% return will double every 8 years.
  • Educate yourself, learn from others, seek out help when needed from trusted sources.  I.e. people like John Bogle, Rick Ferri, Jane Bryant Quinn, Burton Makiel, Eric Tyson, Daniel Swedroe, Charles Ellis, and many others.
  • Put your finances ahead of planning for vacation.  To many people spend more time in one year planning for their vacation then they spend around there finances over their lifetime.  Eventually you will pay dearly in time and money.  If we plan, educate, and take action early our whole life can be a vacation.

Saving and Investing

  • Saving and investing 20% of your income.  Knowing how to invest in no load low-cost index or etf mutual funds that diversity you all over the world at a low cost in stocks and bonds.

Emergency Savings

  • Having enough to pay off your deductibles.  Meet your monthly needs for 6-12 months.  Ask yourself how dependable is my job and paycheck

Having adequate insurance

  • Enough to cover you in case in the event something happens.  To replace your home from tornado, fire damage, 
  • Car coverage to cover if you hit someone or something
  • Don’t need insurance for the little things phone, TV, and list could go on and on.  Cover the big things in your life.
  • For life buy cheap term insurance not whole life.  Separate insurance and investing.

Smart big purchase decision making

  • Car buying – drive it a long time.  i.e. 10 years or longer.  Don’t have the monthly payment mentality
  • Home buying – Put 20% down.  Live in the house for 10 years minimum.  Plan for 1-2% a year in costs.  Don’t look at it as an investment.  Place to raise a family.  Don’t let the mortgage payment limit you to be able to save and invest 20% or more while living a great life.
  • College Planning – Whether you own college or kids college do your research and know what you can afford and limit the loans as much as possible.  See previous episode. Don’t want to be the person or couple paying back loans the rest of your working career.  What is realistic wage you can make by getting that major.  Can you pay back your loans within 5 years.  Don’t spend your retirement money or risk saving less by thinking you need to help out your kids.

Using credit cards responsibly

  • Pay them off on time
  • Using 30% or less of available limit
  • Checking you credit history
  • Credit card interests rates can be 18% , 20% , 22% or more.

Having a prosperous mindset

  • Knowing and planning for a better future.  Going forward with hope in a better you in a better future

Call to Action: 

Take one area that you could improve upon out of these 7 and attack it with massive action.

Resources: