Are you familiar with the phrase “carpe diem”?
If you’re a bit out of the loop, it means that people should make the most of the present time and give little thought to the future.
Living in the moment looks good on paper and all, especially when it comes to doing things like spending time with family, but this same mindset can get you into trouble from a financial point of view.
Americans tend to prioritize debt management over retirement savings when both should be equally balanced.
It’s procrastination at its finest and eventually people realize that only focusing on the short-term isn’t always the best for making the most out of your money.
That’s why I’ve listed a few simple tips about how to take care of your existing debt while still saving for retirement.
Maybe you’re someone who understands the true value of setting aside finances for the future. If that’s the case, then welcome to the minority…
Research shows that 72% of people care more about getting out of debt than they do supporting themselves throughout retirement.
Don’t get me wrong, paying off what you owe is obviously important, but that doesn’t mean you should put all of your eggs in that one basket.
In my opinion, it’s a selfish way to go about things.
Are you really banking on your loved ones to pick up the slack for you when the time comes?
If you’re using all your extra cash to escape debt instead of having everything in place prior to the start of your golden years, then it’s time for a change.
Don’t feel too guilty about this style of money management though. Close to half the population does the same exact thing.
I guess that explains why these people tend to have less than $10,000 in their retirement savings account.
Trust me, that chunk of change won’t last long once your bi-weekly paychecks stop rolling in.
That’s why you need to learn how to juggle debt management and savings.
Don’t simply choose one over the other. Whether you realize it or not, the short-term is just as prevalent as the long.
If you want to achieve true financial wellness, the two need to coexist.
It may seem like a given, but one of the best pieces of advice I can send your way is to avoid spending what you don’t have.
In other words, live within your means and get used to budgeting your expenses.
It’s much easier to fall into debt than it is to climb out of it. However, if you know where your cash is going then you’ll be less inclined to spend more than you make.
Another tip is to deposit whatever bonuses, raises or tax returns you receive into savings.
I know it’s not always easy to turn down a shopping spree after reeling in some additional dough, but it’s much more rewarding in the long-run to put it towards the future.
Saving money is just like anything else. It requires practice before you get good at it.
Even then, saving alone isn’t always enough. Sometimes you have to go a step further and start investing.
If you’re willing to take on a little risk, you can harness the power of compounding interest and reach your financial goals way faster than you ever could without it.
No risk, no reward, right?
Budget, save, invest… If you can take on those 3 things then you can manage debt and build savings simultaneously.
Sometimes it’s necessary to look past the now and plan for what lies ahead.
You should always “seize the day” just don’t forget to make the most out of the remainder of your life as well.