Think of the Future: Saving and Investing for the Family
Thinking of the faraway future seems like an option rather than a necessity for most families. A young starter family has urgent needs - now! Setting aside money for your toddler's education is unthinkable when you need to stock up on diapers today. Thinking of your retirement and a lovely vacation home might feel too absurd when you've just started your entry-level position in work. But the life of living paycheck to paycheck will end one day, and financial stability will take its place. That is, only if you begin to be proactive today.
Begin Saving Now
It will be challenging at the start. But once you develop a habit of consciously setting aside parts of your income, you will begin to have a new approach towards money. You will find that beyond getting your needs met, or buying your wants, acquiring wealth is a rewarding pursuit of its own. Saving money increases your credit score and financial standing, not to mention security and peace of mind.
Of course, saving and investing money for your family isn't a choice, it is, in fact, the fiscal responsibility of the heads of the household. Consider what you can change in your lifestyle to be able to save more. Simple things like energy-saving hacks, cooking your own meal, and cutting out frivolous expenses.
Saving Versus Investing
Consider the money that you've set aside to fall under three categories: Emergency Fund Money, Short-Term Purchases, and Long-Term Goals.
An emergency fund should be enough to cover six to eight months of your expenditures. A portion of your income, no matter how small it is, should be allocated here. Short-Term purchases are savings for anything from travel, holidays, something you fancy.
The money saved for the first two categories should be accessible, preferably kept in a savings account. Consider having extra accounts to put the money in, untouched. One advice is to link your checking account to a savings account and auto-transfer your income directly to it.
Money saved for long-term goals should be invested. Think of assets like stocks, bond, or mutual funds. Because they have the potential to earn more, these options also have a higher risk than traditional savings.
Visit your trusted Bank and learn the various packages they offer. There are various fees, minimum balances, limits and the like involved in all accounts, and this should not threaten you. Take these as important lessons as you enter the complex world of investments.
Investing in Property or stocks
Investing money is essential to wealth-building for your family. As the stock market is maybe too risky for some people, investing in property is another option. Look for trusted Real Estate Consultants that offer specialized services.
We at Metric Investments have a range of services ranging from procurement & acquisition to valuations. Learn more of our services, here.
If you want to take the conservative investment route, Mutual funds are another option you can look into. Remember that your investment attitude should change over time. Consider where you and your spouse are at the moment. While you can afford to take a large chunk of your income, put it in something that yields more.
Downsize Your House
While you're looking at areas to save money, consider downsizing your home if it's far too big to maintain anyway. Utilities can take up a large portion of our income. Keeping up with the bills might consume you. Perhaps this option is viable when you are empty nesting and having many rooms will prove to be a burden in maintenance. The excess money you will earn can be a retirement fund or a special honeymoon!
Other Investment Options
There are other investment opportunities to diversify your financial portfolio. There's an option of investing in gold or silver. Gold continues to steadily rise in price which makes it a safe investment. You can also choose to become a direct investor for start-up companies and small or micro-businesses.
Think of the Future
While no one can ever be certain of tomorrow, planning ahead serves as a great measure to protect the ones you love. Do not leave a legacy of debt for your children and their children. Save and invest your money today.
