Get Your Head in the Game!

Posted on Wednesday December, 9 2009 | 4 Comments

As my family and I approach the last half of our Disney vacation, I thought I would choose a Disney-related title.  Have you ever been out of touch?  clueless?  Have you or someone you know ever been benched by the coach?  If you've made financial mistakes, you're not alone.  Managing money is a game.  There are rules to follow.  A good game plan involves good offense and defense.  Below are some effective strategies to improve your financial game. 

1) Know Your Goal.  You must know the object of the game.  Do you want to reduce debt? increase income?  start investing for retirement?  Knowing and writing down your goal increases your chances for success.

2) Have a solid offense.  Offense means putting points on the board.  If your goal is to have a comfortable retirement, you need to designate a place to invest your money.  Some common choices you have are a IRA, Roth IRA, 401K, and a pension.  Take offensive action and educate yourself starting today about your retirement options. 

  • Create a written budget.  You need to be proactive to win with your money.  Having a written budget means having a destination for your money before your first bill is paid.

3) Have a solid defense.   You need to protect what you earn.  If you're married and/or have children, you need adequate insurance as soon as possible,  Some examples of good defense are the following types of insurance: home, life, auto, health, and disabiliity.  Life has risks and you need to be prepared. 

  • Have an emergency fund.  You need to have 3 months of expenses saved for unexpected financial events.  I recommend an online savings account such as http://www.ingdirect.com  You can have money transferred out of your checking account through an easy registration process.

4)  Hire a personal trainer (certified financial planner).  If you want to improve your game performance, you often have to go to an outside expert.  For a more in depth review of all your finances, consulting a fee only planner is a great idea. You can go to: http://www.nafpa.org  Click on "Find An Advisor" for a financial advisor in your area.

My hope is that that you have a better financial game this next year.  I hope that these suggestions are helpful to you.  Please add any improvements that I may have left out.