Many of us look forward to having the financial resources to live a comfortable life at each stage of our lives. We want to have resources to purchase the items and services needed and accumulate savings for unexpected expenses, retirement, and leisure. Whether you are young or old you need to have the financial knowledge to maximize your financial resources and understand the financial transactions that may arise throughout your life.
Increasing one’s financial literacy can lead the way to sustained financial well-being at each stage of your life. The earlier you learn how: 1) credit works; 2) how to develop and use a budget to control your expenses; 3) establish financial short-term, intermediate, and long-term goals that you are committed to accomplishing; 4) make investments for retirement and child’s college education; and protect your risk through the purchase of the appropriate insurance products the better off you will be at each stage of your life. This will avoid living a life in a panic state, but life that is stress free.
Here are some key actions you should take at each life stage:
Millennials-Age 18 to 34
Determine your financial values and establish financial goals such as a reduction debt. Learn how to use savings and investment vehicles to accumulate savings for purchase of a home and retirement. Limit the purchase of personal use assets and credit card use.
Generation X-Age 35 to 50
Increase investments and retirement savings to from pay increases to continue building your financial base. Stay on track to achieve your goals. Maintain emergency funds. Review your spending and make adjustments, if necessary. Invest in college savings plans such as 529 College Savings Plans. Don’t make plans to sacrifice your retirement savings to pay for your child’s college education.
Baby-boomers-Age 51 to 69
Identify your planned life style upon retirement, including estimation of expected living expenses and income during retirement. Begin to reduce or limit outstanding debt, review accumulated retirement accounts (Employer contribution plans (401(k), Individual Retirement Accounts, and non-retirement accounts as well as estimated Social Security benefits.
The Silent Generation-70-87
Control reoccurring living expenses and rate of retirement income withdrawals from your retirement accounts. Look for senior discounts and financial perks. Review your estate plan, including a review of your will and/or trust.
Whatever your age the key to having what you need when you need it to increase your knowledge of how to use personal money management concepts as well as how they are interrelated to your financial well-being. Remember to use your money to build contentment, wealth, and power.
Source: Washington Informer