When it comes to your financial concerns there are many strategic ways on how to approach them that run through our heads all the time. Popular contemplations that arise are: "Should I focus on paying off my debt?", "Should I use this money to save for an emergency?", "Should I contribute more to my 401K?", "Should I start my kid's college education fund now?" With all these goals in mind, it's hard to place them in priority. Here is a guide to help you through these tough decisions:
Concerns about losing a car or a house
If you find your self in this situation definitely this should be a high priority even if it means having to delay debts like your next credit card payment. Losing a car can make it hard to get to work, or even worse losing a home can devastate a family. A final last measure to save a car or home you can always exercise a bankruptcy if it is a necessity in order to keep a car or home.
Concerns about enough insurance coverage for your family
When talking about this area I'm talking about including health, property, home & auto, and disability insurance. If you have a family those elements are very important to take into consideration. I found a life insurance calculator to help provide an estimate of how much you need to be safely covered: Insurance Calculator.
Emergency savings concerns
Aside from insurance coverages for your families, it is wise to build up and save for a rainy day or for an emergency that arises. It is wise to build an emergency fund between 3 - 6 months of your income. Don't worry if you are not in the position as about 65% of US Americans are not there either, the best way is to start building up this emergency fund as quickly as possible, a good goal is to aim for anything over $1,000 and up. Just start somewhere and build good habits of growing this account. To help grow your accounts something like a money market account or conservative would help, do not risk your money into something that has a high risk and that can lose value if the market were to tank.
Match your employer's retirement plan
While doing all the previous things at the same time here is another place that you can take advantage of. If your employers offer a match on your retirement plans, match it! that is free money and you are leaving money on the table if you are not matching their maximum. I would recommend to only invest the maximum match, then start looking outside your employer's retirement plans as you can optimize the rest of your money in better strategic investing accounts. By experience I have tried to optimize my employers retirement accounts in the 10-15 years I was with them and came up disappointed with the results, but as I grew wiser and more educated I sought out services and products outside my employers retirement plans and have found my self to be more successful at seeing better results outside of my employers retirement plans. Bottom line what I am saying is, yes! do the match and find a trusted institution where you can invest the rest of the money outside your employer's retirement plans. You will find that by doing this strategy you are diversifying your investment and optimizing and strategizing your future retirement resources. Financial advisors can also help you in this area as they have the software and tools to customize and build a strategy for your situation.
Concerns about your interest on your debts
A good way to attack this area is to use that extra money that you didn't put into your employer's retirement plan because you only put the match now you have some resources to attack this debt. There are debt solutions you can use out there, Seek out a reputable financial company that can help you prioritize and strategically places your resources where it will optimize your influence on attacking your obligations and accelerating your debts. By paying down your debts you can save a lot in interest a year empowering you to influence your other financial concerns in a significant way.
Homebuying
A down payment is a good position to be in when you are buying your next house. Once you have worked on your debts and fixing your credit you will be in a strong position to influence your power to buy your next home. By taking care of your credit and your debt obligations those two things will help you minimize the stress in home buying and you get to buy the home that you want!
Am I on track with my retirement?
Financial advisors have great software to help you plan your retirement out. You can also find some calculators online to help guide you and give you an idea on of what you need, but they are not as detailed as what you can receive from a financial advisor. Many people do not take inflation into account when they think of their retirement plans and other important elements that affect your retirement such as the many types of retirement accounts that are out there and how taxes affect your retirement.
Other expenses we don't think of
Although attaining a degree, certifications, and other educational certificates these types of loans should be a low priority because there are ways to help your self and your family through help like financial aid, grants, and scholarships. If you are a young family here is a tool you can use to help give you an idea of how much you should be expected to pay for education: Education Calculator
If you need further analysis to find a financial planner in your area who can provide a detailed plan for your situation. Some companies charge between $800 - $1,200 for a 12 page detailed solid financial plan. There are financial planners out there that provide these types of financial plans for free without any obligations. If you live in the greater Austin, Texas area I provide this kind of services for free. I provide a customized confidential financial needs analysis that covers all aspects of all these financial concerns, my goal is to help educate and help individuals and their families secure a solid financial future and it is my passion to help change families lives and build legacies for them.
Rene Gonzales
Senior Representative
c. 512-568-7203
e. Rene.Gonzales@primerica.com
www.primerica.com/renegonzales
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