I highlighted 6 topics that come up in conversations about personal finance.
The game is long. A 21-year-old who saves and invests $5,000 per year for 40 years will have $773,809 at age 61, assuming 6% growth annually. A 21-year-old who saves $5,000 per year for 50 years will have $1,451,679 at age 71, assuming 6% growth annually.
It is better to have it and need it, than to need it and not have it. Emergency funds are important. Go through your monthly spending and look at which expenses are vital. Once you identify your necessities, then start building up your reserves to cover them.
Plan for the plan not going according to plan.
Control what you can control. Larry David once said, “Weathermen merely forecast rain to keep everyone else off the golf course.” Take predictions from ‘experts’ with a grain of salt. If someone knows where the stock market is going to trade months from now, they wouldn’t be telling you. Control the controllable like how much you save and what you invest in.
Memento Mori. “Remember you must die.” Everyone should have an estate plan. Estate planning is an on-going process that needs to be reviewed periodically for: (a) changes that occur in one’s life, (b) changes to estate tax rules and other laws, and (c) changes in your overall wealth management goals and objectives.
Not all debt is created equally. Debt can either be a powerful leveraging tool or a path to financial disaster.
Will Rogers said, “Too many people spend money they haven’t earned, to buy things they don’t want, to impress people they don’t like.” I like that. Take time to think about what you really want.
TJ Kavanagh – Baird Financial Advisor – firstname.lastname@example.org
Robert W. Baird & Co. Incorporated does not offer tax or legal advice