Investment Planning | Plan Not to Worry

In a recent Gallup poll, 60 percent of those surveyed said that they worried about their financial future. Taking a few simple steps can help reduce these worries:

  • Regularly put aside some savings or other investments. The compounding of earnings can be substantial. The longer your investment period, the greater the beneficial effect of compounding.
  • Invest in what you know. The better informed you are, the better your investment decisions will be. If you don't care to learn about investments, consider hiring a money manager and paying him or her to do your investing for you.
  • Diversify your investments. Consign some of your money to an investment that is easily converted to cash in case of emergencies.
  • Prepare an annual balance sheet (a list of all your assets minus all your debts) to determine your net worth. A comparison of your annual balance sheets will reveal your success at growing your retirement funds.
  • Plan where you want to be financially by retirement age. The calculators listed below will help you determine your savings requirements. Once you know how much you need to save, put your plan into action. More than 90 percent of Americans rely on the government or others for assistance during retirement. With proper planning and diligence, you can be among those who retire in comfort.
  • Don't use credit to purchase consumer items. Wait until you can pay cash for commodities that typically decrease in value. Borrowing money to purchase a home is usually a sound idea. Using credit to purchase household furnishings typically is not.
  • Pay off your credit card balance every month. Your credit card should be for the convenience of purchasing, not a source of permanent finance. The interest rates are far too high.
  • Monitor your investments to maximize your after-tax return. Use the calculator below to compare the long-term results of different interest rates. The difference that a 2 percent greater return can make in the growth of your investments is dramatic.
  • Ask your insurance agent to conduct at least an annual review of your insurance needs to determine that you are neither under- nor over-insured. Be sure to contact your agent when you buy or sell any property.