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Personal Finance
Don’t Shoot Yourself In The Foot With Your Money In 2022
7 Things You Can Start This Month
You can talk about your budget, your nifty budget spreadsheet, or app all you want, but it’s all fairytales and unicorns if you don’t follow the budget.
Create a budget, and maintain the discipline to stick to the budget. If you need additional accountability, log every transaction; this is something I still do to monitor my finances actively. Micromanaging is best done with your finances; it keeps you focused on your financial goals and prevents you from making costly decisions.
2. Max out your ROTH IRA and ROTH 401k
IRA: For 2022, the max contribution limit is $6,000 if you’re 50 and under. If you’re 50 and older, you can contribute $7,000 total this year. If you contribute $500 a month, you will have $6,000 saved by the end of the year. Can’t imagine investing this kind of money? Get creative, cut your expenses, or increase your income.
401k: For 2022, the max contribution limit is $20,500 [an increase from 2021] if you’re 50 and under. If you’re 50 and older, you can contribute $27,000.
3. Do not add new debt.
“You only live once, and you deserve the ultimate experience and things!” This is the message society is shoving down our throats. Don’t give in. The standard method to pay for all of the things and experiences we buy is via money we don’t have. Stop doing this, and you will set yourself financially free.
4. Decrease your old debt.
Once you have committed to not adding to your existing debt pile, you can focus more energy on eliminating your debt.
5. Continually educate yourself on evolving new technologies.
Learn about crypto and blockchain technology. Technological change moves at the speed of light; technology outpaces the previous year each year. Web 3.0 is the future – whether you believe it or not. You either get on board now or get on board later and miss the next “amazon” investment opportunity.
Scared to dip your toes in the crypto investing pool? Educate yourself so that you can be an informed and confident investor. Crypto and blockchain are synonymous with “tech stock.” You probably have a percentage of your investment portfolio allocated to tech stocks if you invest now. Investing in crypto is essentially the same thing – except more volatile, which is why it is a great idea only to invest 1–5% of your entire investment portfolio if you want to remain on the safe side. Eventually, more crypto and blockchain companies will have skin in the game. We’re already starting to see this with crypto ETFs.
6. Stop trying to impress people. Most people are fake rich people.
Do you know how much money we waste trying to impress people who don’t give a damn? A lot. Save your dollars and invest them; you’ll arrive at the point where you can flex on people, but you don’t because you realize it’s an empty pursuit.
One person pretends to be rich, yet has nothing; another pretends to be poor, yet has great wealth., Proverbs 13:7, MSG
When you have real money, you don’t need to impress anyone. Don’t be a fake rich person; those are the worst.
7. Stop doing what you’ve always done.
Clearly, what most Americans frequently do with their money isn’t working.
Most people don’t have an emergency fund, most people are in debt, most people have too many credit cards that they abuse or are not creditworthy enough to own one, most people don’t follow a budget, and most people live paycheck to paycheck.
If you find yourself in the shoes of most people, do the opposite; most likely, doing the opposite [being the outlier] will not lead you astray.
Bonus – 8. If you still don’t have an emergency fund, get one already!
Not sure why people put this one on hold time and again, but it needs to stop. Emergency and wild insolvencies will visit. Instead of being unprepared financially, start being prepared so you don’t have to go into debt every time something unfortunate happens in your life.
Hey, I’m Destiny, and I give away my books for free daily. Get yours: Here.
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This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.