Tiffany Raiford
Financial advice is not something that’s few and far between. It’s everywhere; it’s all over the internet and the paper and the news. It’s coming from your parents and your grandparents and your financial advisors and the person sitting next to you on your flight to New York City. Your lawn maintenance guy likes to talk to you about financial advice and you have to provide stellar financial advice to your kids. You talk finances with your friends and your spouse and everyone in between, and yet we all tend to ignore some of the best advice there is. There are few people in life who don’t ignore financial advice at least on occasion, and those are the people who are likely doing all right. Some financial advice is worth its weight in gold, and some is worth ignoring. Sometimes you have to do what you have to do to get ahead and you have to ignore rules and take chances. But sometimes you have to just take the advice of those who know better than you and roll with it. Some financial advice is worth taking more often than not, and we have that advice right here. Read on to find out which great pieces of financial advice are most often ignored by people who already ‘know better’ than to listen to this advice.
Save for Retirement as Early as Possible
Everyone likes to tell you just how important this is, and you don’t like to listen. It’s really not a good piece of advice to ignore, and here is why. When you get your first job and you have benefits and can contribute to a retirement account, you aren’t going to miss that money. You’ve never, ever seen it so its absence has no bearing on your life. Also there’s inflation and the cost of living and the lack of social security at some point, so go ahead and stop ignoring this advice.
Contribute the Max to Retirement
It’s so important and so many people choose not to do this. You should always give as much as you can, especially if your employer matches even just a little of your retirement contributions. People, it is free money. FREE MONEY. There is nothing in life better than free money, especially when you feel you’re probably underpaid to begin with.
Save an Emergency Fund
At least $1000 is imperative to have in savings because you honestly just never know what you will have to deal with. In the past four months I have had to pay a grand total of about $600 per week in additional expenses for things that have come up we were not expecting. Imagine not having the funds to repair a damaged vehicle, or to save the life of your cat that was attacked by the dog you adopted, or to pay for a new washer and dryer when yours finally break after 10 glorious years the week after Christmas when you have a family of 6. Imagine not having money for that stuff; it would be terrifying.
Save
In addition to an emergency fund, you need to save money, too. You need savings for so many things. You can make up what you need it for, but you do need it. You need it for vacation, for things you don’t have the money to pay for otherwise. You need it for peace of mind if nothing else.
Pay Off all Debt
You should not have any debt. Debt is evil and it’s bad for you and it’s just terrible. Why people have it is beyond us. You should not buy things you do not have the cash to pay for, and that is just as simple as it is, to be quite honest. Debt is something you should work on paying off before you do anything else.
Pay Off Credit Cards in Full Each Month
If you have a credit card, you need to pay it off in full each month. It’s a good idea to have a credit card, but you should only use it to pay the things that you need to pay each month, in full. It’s the only way you are going to be able to ensure you are keeping your credit clean and good, and that you are not reaching into debt as a way of life.
Know the Difference Between Good and Bad Debt
Some people will disagree that there is anything but bad debt, but there is. Not everyone can afford to pay for a house in cash, so we consider a mortgage a good debt. A bad debt, however, is a car loan. This is not something that will ever pay off for you, and it’s worthless. A house, on the other hand, is a good debt that pays you in the long run. Know the difference and keep your good debts higher than your bad debts.
Slow and Steady Wins the Race
There is something people fail to realize, and it’s that the tortoise always beats the hare. This works because the tortoise is slow, steady and careful throughout the race. The hare is fast and reckless. There is no such thing as a get rich quick scheme. Careful planning, slow saving and attention to detail will always pay off more in the long run for those who embrace this financial advice.
Saving a Little is More than Nothing
When someone says, I can’t save anything, I laugh. Sure, there are people who really cannot afford to even pay their bills each month, and they cannot save. But there are also people sipping a latte and planning that trip to Puerto Vallarta while telling me they cannot afford to save anything during the month. Please, you can save all you want; you just choose not to save. One of my favorite pieces of advice and something I love to tell people who need a boost getting started in the savings department is to save the number of the week each month. Save $1 the first week of the year, $2 the second week, $3 the third week and so on until you’re saving $52 per week the last week of the year. It’s a very quick and inexpensive way to save a lot of money.
Stop Wasting Money
It’s the best financial advice you will ever receive. Stop leasing a vehicle you’re paying $600 a month to drive and can’t ever own. Stop trading in your car every 3 years for a brand new one and wasting your hard earned dollars on things like that. You can do it; stop wasting.
Photo by Spencer Platt/Getty Images
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