When it comes to handling money, we all fit into one of three personality types, spender, saver or investor. Having said that, it is not as easy as saying you are a clear spender or certainly a saver because we can easily cross over from one group to the next. Sometimes we may be a saver and at other times we spend. An investor may switch to saving at times and a spender may spend the majority of the time, but also save a bit each month. The point is, we are not definitely one over the other two, we filter from one to the other at different times, so the question is which money personality type, do you predominately fall into?
Below you will see a series of statements for each personality type. If you answer the majority of the statements within a personality type in the positive, then that is the preference you have when it comes to dealing with money.
If you want to be an investor, but you came out predominately a saver, well its only a short step to moving over into investment and making a few adjustments. If you came out a spender, you are going to have to look at a making some lifestyle changes, if you really want to begin investing for your future, and the main change you have to make is switching from a spender to a saver.
If you are a spender and do want to be an investor, the best way is not to try and do it immediately. Start gradually by making note of all your monthly spend and cutting back on the purchases that are ‘wants’ and not ‘vital needs’. If you have any debt, look to clear that debt as quickly as possible and as you begin to gain extra money each month, resist the temptation to spend it, but rather start investing small by placing it in a good saving account with reasonable interest.
There is a lot more that I can say on turning from spender to investor, but the purpose of this post was to help you ascertain your money personality type. If getting out of debt is a priority to you, then I recommend you check out the various programs on offer from daveramsey.com
If investing is something you want to consider, I do have a section on this site covering the various types of investments, or you may want to check out information on gold investment companies if you want to invest in something different, like precious metals.
Everyone wants as healthy a credit score as they can get, but sometimes circumstances can negatively affect our score and getting credit then become extremely difficult because our score gets reduced. So if that ever happens, what can be done to get your score back up into the healthy section?
Well before I give you some tips to help boost your credit score, you need to know that there are no quick fixes. Your credit scoring is a reflection of your credit history and so therefore adjusting it can take time, especially if it was reduced because of unfortunate money management in the past. If your score is low because you have not had much credit in the past, then the length of time it will take to improve can be shortened.
This can be obtained from the likes of Experian who will provide you with a record of your credit history, which is reviewed and monitored by all of your current and future creditors. This will tell you exactly what payments you have made to your creditors over time, whether they were on time, whether any were late (and by how much). The record will tell you what your current credit score is and if it is low, you will be able to tell from your history, if it’s low due to poor money management or a lack of credit history.
Look at all the credit you have and ascertain from the report, which are not necessarily the biggest debts, but the ones that are closest to the limit. For example; if you have two credit cards, one with a $1,000 limit and $900 owed and another with $3,000 limit and $2,000 owed, work on bringing the amount owed on the $1,000 card down first. Of course don’t increase your debt on the $3,000 card as you do it. By doing this, it shows that you are not living on the limit and can actually manage your money.
If you have multiple debts in this situation, start with the smallest first to get them out of the way, and then work your way up to the biggest.
The management of your payments makes up around 35% of your score. If you are late or default on payments then this will have the biggest impact on bringing your score down. If you have a low score due to not having a lot of credit, then make sure you never miss payments. The best way to always ensure payments are never missed is to set up automatic payments every month from your bank account – a set and forget approach.
By paying more than the monthly required payment each month, not only shows that you are looking to reduce your payments quickly, but it also shows you can manage your money.
When you eventually clear the balance on your credit cards, don’t close them. For one you may need to use a credit card in an emergency, but also 15% of your credit score is made up of the length of time you have had an account opened. Even if you are not using the card anymore, the fact you have had the account for a number of years bodes well for your score.
If your score is low because of poor management, then do not apply for more credit. Each time you apply for credit it leaves a footprint on your record. The more times you apply, the more footprints you leave and if you leave too many, it looks like you are credit hungry and this is damaging to your score. Every time you open an account it affects your score by 10%, so if you apply for a new account and it’s not granted, you’ve just undone all your hard work in building up your score again.
Now these tips are not exhaustive but they will go some way to help you begin to improve your score. The biggest thing to remember is to cut back on your spending and increase your paying.
As far as finances go, a major concern of most retirees is running out of their retirement savings. It is indeed a grave predicament to find oneself in, and one that should be avoided at all costs. If you are wondering what you need to do in order to ensure your nest egg lasts you for as long as you live, here’s what:
The first thing you need to do to secure yourself against financial distress in your retirement years is to maximize your social security. Even though you are entitled to social security payments for the rest of your life, it is important to understand how to maximize these payments. Do this by carefully deciding when to sign up for benefits and coordinating your claiming decisions with your spouse. If you delay in taking Social Security for a year, you get an 8 percent increase in the benefits that you take, and this is true for every year you delay.
If you wish to have enough money to last you the entirety of your retirement, plan your finances as if you will live into your 90s or even until you are 100. Many people will plan for too few years only to live longer and become completely dependent on Social Security.
Protect yourself against inflation by investing a portion of your money in investments that have the ability to keep up with inflation. Equities, commodities, real estate, investing in gold and even some government bonds have historically kept pace with inflation and you should consider adding these to your portfolio.
If you are willing and able to afford it, consider investing a portion of your money in an immediate annuity. An immediate annuity guarantees you a stream of payments that will continue for the rest of your life. Talk to your insurance company about this, but remember not to annuitize all your money because you need funds available for emergencies.
If you want your money to last you for the rest of your life, you need to control your withdrawal rate. Take only small distributions from your portfolio, and withdraw even less during those years when your portfolio is behaving poorly. A 4 percent withdrawal rate will increase the chances of your money lasting longer, and if you can go below that, the better. Anything higher than 5 percent is risking running out of money during your retirement.
Retirement can be a great time, or a distressing one, depending on how you plan your finances in your earlier years. Make the right financial choices and you’re most likely to have a great retirement.
One day you’ll be retired and relaxing on the beach, watching the sun go down. Whether your brow will be creased in worry, or you’ll have a big contented smile on your face will depend on this-whether you prepared adequately for your retirement. Preparing for your retirement should be done early enough and diligently. You do not want to get to your retirement only to realize that your retirement savings are not enough to last you the entirety of your retirement/life. If you have been wondering whether you are doing enough to save for your retirement, here are signs that should tell you that you aren’t:
You have not started saving
If you are waiting to start saving once you get to age 40, you are setting yourself up for a very hard retirement life. The earlier you start saving for your retirement, the better; as you will have more money saved for your golden years.
You have a hard time paying for medical bills
If paying out-of-pocket medical expenses is a struggle to you currently, this is a sign that you need to prepare yourself very well for old age, as far as medical expenses are concerned. This is especially so because as you grow older, medical expenses becomes even more pricey.
You have credit card debt
If you have credit card debt, there is a high probability that saving for your retirement is not even on your list of priorities right out. Straighten out your debt and get to saving. And while you are at it, you might want to avoid accumulating any more credit card debt.
You’re spending more than you’re saving
If a huge chunk of your income goes towards expenditure which is not even accounted for, you are definitely not getting prepared for retirement the right way. It is recommended that you dedicate 10 to 15 percent of your income towards your retirement savings.
You do not know how much money you will need to retire
If you have no clue how much money you will need to continue your current lifestyle after you retire, high chances are you are not saving enough, if at all you are.
You’re not getting the full match from your employer’s 401(k) match
If the company you are working for offers to match a portion of your 401(k) contributions, contribute enough money to get the full employer match. This is a quick and easy way to boost your retirement fund, and you will actually be getting free money. If your employer offers this program, you are doing yourself a great disservice if you are passing it up.