Whether it is car repairs, medical bills or a sudden job loss, unexpected expenses are sure to pop up from time to time. Putting aside three to six months of living expenses into an Emergency Fund should be at the top of everyone’s financial to-do list.
How Your First Job Can Impact Your Retirement
The moment you walk through the front door, your phone rings. You fumble the smartphone out of your pocket and answer it eagerly, speaking with the job interviewer that you just saw an hour ago. They excitedly give you the good news as you can barely hold back the scream of joy. You landed your first job and will start work on Monday. When you go to bed, you start thinking of all the things that you want to do and buy with the salary you will make from the job.
Reining in Out of Control Spending
Ask your grandparents how they purchased their first home and you may be shocked to learn they spent years scraping together a down payment or even purchased it outright. Today, buying groceries using credit is quite common. Credit cards have made it easy to spend quickly and effortlessly, yet this can be one of the most challenging – and worrisome – of all financial trends. As a consumer, you know you want to spend less, especially on credit cards. Yet, with everything “a swipe away” it’s just too tempting to buy what you want whenever you want it.
A long vacation to a far off destination is the perfect way to spend summer, but that can be expensive. Trying to stick to a budget? Then, this year, you may want to modify the family vacation. After all, kids don’t care about fancy perks or exotic locations. They just want to spend time with you.
Retirement savers who start earlier, rather than later, enjoy plenty of advantages. The most overwhelming reason to begin saving as soon as you can is that you put your money to work for you as soon as possible. The money your savings will earn this year will continue to grow next year and for many years in the future. It is this cumulative effect of saving over time that makes today’s $1,000 contribution to your retirement plan a lot more valuable than the $1,000 you might sock away the day before you leave your last job.