We wish that financial planning was as simple as finding a pot of gold at the end of a rainbow, but most of us aren’t that lucky. Instead of searching for four-leaf clovers, focus on creating a long-term financial plan and sticking to it.
Here are a few dos and don’ts to help you get started.
- Do create a budget and hold yourself accountable – Luck is fickle, but creating and sticking to a budget is one way to stay within your means and set yourself up for a successful financial future.
- Don’t rely on credit cards to fund your life – Credit can be helpful if you’re trying to make a large purchase like a home or car, but debt can be an albatross around your neck preventing you from saving for major life purchases and for retirement. Don’t add credit card debt into the mix! The sky-high interest rates could result in you owing much more than you originally spent, and if you have trouble paying it back, your overall credit could suffer. Luck won’t help you there.
- Do make and grow your emergency fund – Try to save at least six months of living expenses in an emergency fund. That goal might seem tough to reach, but start small by setting achievable goals and working your way up.
- Don’t break into your emergency fund for anything other than emergencies – That impromptu vacation you just got invited to doesn’t count as an emergency. In the event that you lose your job, your car breaks down, or you have a medical emergency, you’ll feel very lucky to have that cash cushion set aside.
- Do plan ahead for retirement – Retirement can feel very far away, but plan ahead by envisioning your retirement and setting up a savings plan to help you achieve that vision. The improved confidence you may feel from knowing you’ve prepared for financial security in retirement will be far more satisfying than wondering if you’re going to hit the financial lottery.
- Don’t feel like you have to go it alone – Connect with a financial advisor who can help you create a budget, stay on track, invest in your future and design a plan to help maximize your retirement savings. Partner with someone you can trust—a good rule of thumb is to ask if they are a fiduciary and expect a yes or no answer.
This St. Patrick’s Day, make your own luck by planning for your financial future.