Two Income Trap: Five Financial Tactics That We Can all Learn from Elizabeth Warren
Elizabeth Warren is a financial genius. She is not only a US Senator, but she is also worth millions due to her savvy investment s over the years. If you want to improve your financial situation, this is a great expert you can turn to for advice. If you are looking to invest smartly like Warren does, then follow these five tips she uses to invest:
1. Pay Down Your Debt
The number one piece of financial advice that Warren stresses is to pay down your debt. Every day that goes by with you in debt means that you are burning money. The interest rates on debt will sap even the healthiest financial portfolio. Before you start any other kinds of investing, you need to get out of debt. Consider using a budgeting system online that will help you budget more of your money to pay off your bills. When visualize where your money is going and how much you need to save in order to pay off your debts, it will be much easier for you.
2. Don’t Spend More than You Make
This is a very simple piece of advice that the majority of people simply blow off. Spending more than we make has become an American way of life over the last 50 years. If you want to be financially sound, then you should spend 50 percent of your income on things you need like food and housing. 30 percent of your income should go to luxury items like entertainment and travel. The remaining 20 percent of your income should go into savings.
3. Take Advantage of Retirement Funds
You need to take advantage of the tax-free retirement funds that are available. You should invest the maximum amount of money you can in these. This is especially true if your company provides matching funds for your 401k. If you fail to take advantage of these matching funds, it is like throwing money away.
4. Invest Wisely in Stocks
You need not be afraid of the stock market. Warren recommends investing wisely in stocks to help provide for your retirement. The best way to invest wisely in stocks is to get advice from experts. You can learn a lot about stock investing in the Money & Markets Stock Newsletter and other online financial recommendation sites. You will get expert advice that will help you make the most of your stock purchases.
5. Don’t Make Foolish Investments
Warren also advises people to steer clear of foolish investments. Some of the things she considers to be foolish investments include collectible coins, prepaid funerals and gold. She thinks that you can invest your money more wisely by sticking with stocks and bonds. Also, be wise in the stocks you choose to invest in. Make sure you spread your money out over different stocks and investments, so if something happens, you won’t loose all of your money.
If you follow Warren’s advice, you will get financially healthy in a hurry. Pay special attention to her advice to start saving 20 percent of your monthly income. This is the best way to prepare for your future.
Category: Family Finances
