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Accomplishing your financial goals takes comprehensive planning. Looking at things from all angles to figure out the most efficient ways to get where you want to be both in the short and long-term.

I know I should contribute to my 401k. I have even been told that I am behind on my savings! I also read somewhere that I should be saving at least 15% of my gross income towards my retirement goals. Maybe I should open a Roth IRA as well? Okay, now is the time! I am finally ready to join the world of investing. Sound familiar? Pump the brakes! Take a minute to discover when investing is a bad idea.

We all know the story. You have a spouse, two kids, a dog, and a mortgage.  Maybe a couple of car payments, some student loan and credit card debt. You are also seriously considering buying an investment property with your brother. Month-after-month, living paycheck to paycheck you are surprised you even keep things afloat. Now is the perfect time to start saving for retirement! Wrong! Don’t get the cart in front of the horse!

Remember that accomplishing your financial goals takes comprehensive planning. Looking at things from all angles to figure out the most efficient ways to get where you want to be both in the short and long-term.

Do you even know why you are living paycheck to paycheck? Have you made time to reconcile your bank statements to establish a monthly spending plan? How can you possibly squeeze out more to contribute to 401(k) or to purchase an investment property?

Consider the power of compounding interest. Money gains interest, then that money plus interest gains more interest, etc.; having a snowball effect. The same can be said for the way debt interest compounds. Debt has the very same snowballing effect. The total amount owed increases every month that it is not paid off. If you have any significant non-mortgage debt, any growth within your investments could be swallowed up by the fact that your debt is likely growing at an even faster rate.

So when should you start investing? How much should you invest? That is a very individualized conversation. You must get with a financial advisor that will get to know you and your decision patterns as they relate to your money. A good advisor will not sell you a product. Instead, they will build a relationship with you to coach you into making increasingly better financial decisions over time. Remember, never make isolated financial decisions without considering the whole plan. Get with it! You’re not getting any younger!
 

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