To make a long story short.....I moved in with my aging parents with the promise that the house would be bequeathed to me in exchange for taking care of my parents. Five years later, my father is deceased and my mom is 83. I have 5 siblings, one of whom took issue with my getting the house. After some intense family squabbling and in the interest of family peace, esp. for my mother, the house is going to be bequeathed to all of us; I will be living there rent-free for the rest of my mother's life. Unfortunately, thinking I had a home for life, I was remiss in saving money, ran up some credit cards and co-signed loans for my two nephews in college. I am single, make approx. $52,000/year. I have started paying off my credit card balances with a fury and have opened a credit union account of which I will have a certain amount deducted from every check (that amount will grow when my cards are paid off.) I am also cutting expenses as much as I can. I work for the state and will get a pension although I doubt I can ever retire. It's not a pretty picture (for which I take responsibility) but is there anything else I can do to secure a better future?
It sounds like you may be off on the right start by creating a budget for yourself to determine if your expenses are aligned with your income, you have money, and ultimately have money available to invest for your future.If your expenses consume a substantial portion of your income and you have little left over for savings you should look into ways of cutting your expenses. If you find yourself with excessive amounts of debts, especially unsecured, with high interest rates your first task is to reduce those to a more manageable level. The less debt and expenses you have the better financial position you will be in to begin investing, which will help you have a better future. Below, I list a few of the basic steps that may help you build a better future.
If you work for a company that provides you with a 401(k) benefit plan or non-profit that offers a 403(b) you should take advantage of this opportunity. Contributions (called elective deferrals) to a 401(k) and 403(b) are pre-tax, and in many cases the employer will match an employee's contributions to the plan. If you are self employed there are other plans such as an IRA, which there are a few different types, or Roth 401(k). The goal you should consider is to maximize your contributions each year.
Another step, when assessing your finances, would be to make sure you are putting aside for a "rainy day"; so to speak. Many financial planners recommend households save three to six months of your living expenses; for emergency reasons, such as job loss or similar unplanned but foreseeable calamity. Keep in mind that savings is different than investing, and you want to make sure that you have easy access to your savings in the event of an emergency. Savings are held in a liquid short-term account, such as a savings account, certificate of deposit (CD), money market account, or a savings bond.
When you place yourself in a financial position where you can invest, the next step would be to determine your goal, and your strategy or strategies to achieve that goal. Your goal and strategies should consider at least two important factors: Your age and when you want to access your investment. If your goal is to invest your money and pull out within five years you may want to consider money market accounts, bonds, or certificates of deposit. Investing in stocks is generally considered by experts to be for investments lasting five years or more. Investors tend to see positive returns in the stock market after this time frame.
To learn more about how to begin investing in your future I encourage you to read an article I wrote, How Do I Start Investing in the Stock Market?.
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I hope this information helps you Find. Learn & Save.