Don't Throw Good Money After Bad | Financial Planning

By BarryWaxller
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We all make ghastly mistakes with our money. This is true whether you make a ton of it or just enough to get buy. If you looked back at what you did with your money over the last five years, you would groan. Let's make the next five better.

Getting the most out of your money takes discipline. A huge, but subtle, area where we all lose the value of our money is through failing to act. We fail to start saving for things such as a home now, which puts off the act we ultimately want.

We are a debtor nation and that is not a good thing. If you ever hope to get out of debt, you must stop spending more than you bring in. It can be tough at first, but it will ultimately pay off. Turn this one trick and your finances will improve.

Credit should be viewed as something you can tap into in a tough situation. Unfortunately, many of us make the mistake of living on credit as a part of our daily finances. Don't! Get out of debt and start keeping your own money.

Do you really need that? Americans are massive consumers. We buy all types of things that seem great, but depreciate quickly. Don't make impulse buys. Don't let your emotions get the better of you. Remember, that new computer will be out of date in a year.

Credit cards are evil. Let me say that again. Credit cards are evil. Cut yours up. Any good financial plan stars with this step. Keep one if you must for emergencies, but cut them up otherwise. Use your debit card for convenience and to keep your spending under control.

Saving for retirement is critical. Don't make the mistake of waiting to long or not saving enough. Most retirement predictions these days are wrong. Medical care is improving yearly. You might live to 100, so make sure you have the money to do that.

Don't spend a dime on anything a financial guru says. Whatever you do, don't buy any books or cds they are selling. Financial gurus are scam artists and are only good at selling themselves. Don't spend your money on their junk.

The number one way to be unhappy is to live according to what others think you should do. Don't. Live for yourself and plan your finances accordingly. If you want to travel, save to do it instead of buying a new car.

Save up a year of expenses. Figure out how much money you would need to survive for a year. Now go about saving that amount up. Once you have it in hand, you have created a nice financial buffer. Lose your job? You have a year to find another one!

At the end of the day, you are the master of your finances. Plan well and you can live well. Plan poorly, and you'll be in big trouble. Obviously, you should do some planning!

About the Author

Barry Waxler is a financial advisor with UFCAmerica.com.

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