50% of Americans Do This With Their Money and It’s Not Good for You
Half of Americans are worried about money. Our top fears, according to a recent Gallup poll, are retirement, paying for medical events, and keeping up our standard of living.
It’s the element of the unknown that freaks us out. So let’s get to know our money!
When you make a budget, you know exactly how much you have to save, spend and give each month. It allows you to look your fears in the face and laugh at them like an over-caffeinated Mad Hatter.
There’s no need to fear your financial future. Everyone is capable of retiring the way they want and providing for their family’s needs along the way. It can even be fun, believe it or not!
Three Tips for Taking Control With a Budget
Worry #1: Not Having Enough Money for Retirement
Your Plan: Before you start saving for your future, you’ve got to take care of your present. You don’t want to end up cashing out that 401(k) early (and paying heavy fines!) to cover current bills. That’s why it’s important to start your $1,000 emergency fund first. This will cover you in case you have any pop-up expenses. Then you’ll want to knock out your debts and build your emergency fund to equal three to six months’ worth of expenses.
Now that you’ve freed up money that was going toward debt and emergency savings, it’s time to add retirement to your budget. Eventually, you’ll want 15% of your income headed into good growth stock mutual funds. (And be sure you’re getting that company match as well!) With a simple plan, you’ll retire when you want, how you want. Florida Keys, anyone?
Worry #2: Not Being Able to Cover Serious Medical Costs
Your Plan: Remember that three-to-six-month emergency fund? It’s the key to doing away with unplanned expenses. For example, if your spouse needs ACL surgery, the last thing you need is money worries. Your focus is all about keeping the household in order until they’re well again.
With your emergency fund in place, you’ll be able to care for your family, instead of working overtime to cover medical bills. Also be sure you have great health insurance now (with a deductible you can afford) to offset some of the risk. Saving three to six months’ worth of expenses in an easily accessible savings account will give you piece of mind in a stressful situation.
Worry #3: Not Being Able to Maintain the Standard of Living You Enjoy
Your Plan: You can do whatever you’ve planned in your budget! Empower yourself to live the life you want by ironing out a solid budget each and every month.
If you want to enjoy all your favorite restaurants, drive the brand of car you like, and enjoy summer vacations for the rest of your life, no problem. Simply work it into the budget today and save for what you want tomorrow. You’re in charge of the life you want.
The Bottom Line
Money is something you can control. So don’t let fear creep into your bank account. Use EveryDollar to create a budget you can rely on and keep your family happy, healthy and worry-free!