Secrets For Financial Security

Is it possible to find financial security in uncertain times? Today on MoneyWise, we’ll let you in on a few secrets for financial security. Full disclosure up front: These aren’t really secrets. But they might as well be since so many people don’t do them! TIPS FOR FINANCIAL SECURITY 1. Live on less than you earn. If you don’t, there’s no way to save and you’ll almost always run up debt. But if you can get on a budget that allows you to live even a little below your means, you’ll stay out of debt and have something to put in the bank for emergencies. Fail to do this and you’re looking at a long, hard road full of financial potholes. The MoneyWise app makes setting up a budget a breeze. 2. Ignore investing experts on TV. This is especially true if they tell you to buy everything in sight when the market’s up, or that the sky is falling and you need to sell now. The real secret to successful investing is to own quality index and mutual funds, along with some bonds, and to hold them for a very long time, regardless of what the market’s doing. Unless you’re a very savvy investor or have money that you can afford to lose, shy away from individual stocks. Forecasting the profitability of single companies is too complicated for the average investor. 3. Buy term life insurance to protect your loved ones. Avoid whole life and permanent policies that mix insurance with investments. Anything but term insurance is too expensive and won’t give you the returns you can get by investing separately. 4. Get rid of credit card debt. Use the snowball method to pay down the smallest balance first, and then move on to the next. But you can only do this if you’re following the first secret, live on less than you earn. That way you’ll have extra each month to retire your credit card debt. Paying interest on consumer debt is like burning money. 5. Buy cars for the right reason. Cars are expensive and having sky high monthly payments on a car loan is a sure way to bust your budget. Buy cars for reliability and fuel efficiency, not to show off to the neighbors. 6. Be neighborly. There’s more to relationships with those living around you than just being social. For example, a neighbor can be a source of tools you won’t need to buy as long as it’s a two-way street and you always return anything you borrow in good condition. Neighbors can also be a wealth of information about your area, like the best places to shop and what deals are out there. Just be sure to give as much as you receive. 7. Don’t touch your retirement savings. Throughout your working years there will be many times when it seems like a good idea to tap into your 401k or IRA. But it’s a quick, short term solution that’ll cause long term pain. Instead, work diligently to build an emergency fund of 3 to 6 months living expenses. 8. Turn off the TV. How will that help? You won’t be bombarded by advertising. Financial teacher Ron Blue likes to say that advertising convinces you to buy things you don’t need and can’t afford to impress people you don’t like. The less advertising you see, the less likely you’ll be to buy something on impulse that will almost certainly end up in a closet or out in the garage when the novelty wears off. 9. Pick inexpensive hobbies. Speaking of novelty wearing off, have you ever invested in a hobby that you later realized wasn’t all that fun or interesting? Like taking up golf or scuba diving? These can cost hundreds or even thousands of dollars just to get started. Instead, look for hobbies that have little or no ongoing costs. An example might be teaching yourself how to play a musical instrument or taking a class on building a website or cooking. You can do many of these things online now at relatively low cost. 10. Don’t gamble. That includes not playing the lottery. You have better odds of being hit by lightning twice than winning what is really just a state-sponsored numbers racket. It’s also bad stewardship. Gambling doesn’t glorify God in how you use His money. On today’s program, Rob also answers listener questions: ● What is the best way to pay down a mortgage more quickly? ● What is an in-service distribution? ● When does it make sense to change up your investing strategy or allocations? ● How do you take distribution from a 401k? ● What are the financial considerations of investing in a family farm? RESOURCES MENTIONED: ● Find a Certified Kingdom Advisor Remember, you can call in to ask your questions most days at (800) 525-7000 or email them to [email protected]. Also, visit our website at MoneyWise.org where you can connect with a MoneyWise Coach, join the MoneyWise Community, and even download the free MoneyWise app. To support this ministry financially, visit: https://www.oneplace.com/donate/1085/29