We live in a world of risk. The economy is struggling. Although money is not the source of happiness, good financial decisions go a long way to promote happiness while reducing fears. Here are five ideas that help promote financial stability in this age of uncertainty:
1. Pay down debt. Many people carry high-interest credit-card debt from month to month. This eliminates your financial flexibility. Paying off expensive credit card balances is a guaranteed way to save money. Pay off this debt and don’t borrow again.
2. Refinance long-term debt. Today’s low interest-rate environment is something we have not seen since 1950. Opportunities to refinance your mortgage with fixed interest rates near four percent or below now exist. Once you refinance, consider continuing payments at the level you are used to in order to accelerate the pay-down of this debt.
3. Live below you means. Being wealthy is not just a product of a high income or smart investing; it’s learning how to save. Make a commitment to live below your means and save as much as you can for a rainy day. You will reduce your need to sell investments at the wrong time due to an emergency. You will also reduce the likelihood of needing to go into debt.
4. Bounce back from defeat. It’s easy to get discouraged. Don’t! Most successful people have overcome obstacles and failures along the way. Even though it’s difficult, you stand a better chance of getting back on track by maintaining a positive perspective.
5. Increase your giving. How could giving increase your wealth? I have worked for more than 30 years in the personal finance profession. So many of the successful, happy people I am privileged to work with give generously. They began this when they were of modest incomes and of modest means. It is a law of the universe that I believe our Creator set up. A generous heart is medicine to our souls. You end up helping yourself when you help others.
For more insight, listen to Jentner Wealth Management’s weekly podcast by clicking here. Or download Jentner’s newest white papers on The Four Cornerstones of Prudent Investing and The Active Versus Passive Investing Debate.