I was recently asked to help some independent contractors with their retirement savings needs. Many people try to use some preset thought process of how to save for retirement. Often it is based on getting a matching contribution or some rule of thumb such as saving 10% of their income.
Unfortunately, our children do not get a financial education while in high school. Those who go on to get a college education will only learn about finance in certain classes they take, and more specifically, through the degrees they earn. Most families don’t talk about money either.
Singing the investment returns blues? Your investment returns aren't performing as well as you planned? Does your Morningstar investment rating show 5 stars, but your actual investment returns only show 1 star? You might need a better investment returns recipe!
One of the most compelling reasons to start investing early is the power of compound interest. Compound interest is the interest earned on the initial investment as well as on the accumulated interest. In other words, when you invest, your money can grow exponentially over time.
Most of us hate uncertainty. Unfortunately, picking investments almost always involves uncertainty. This is obvious if you review the long list of investments available to include in, say, a 401k investment menu. That’s because while you can look at the past performance of each investment, you ultimately have no way of knowing which investments will perform well in the future.
No matter what the thoughts are a budget can help you help from having those dreams slip away. Not just any spending plan, but one that encompasses the what-ifs of today and the probabilities of tomorrow. Let’s start with tomorrow.
