photo by thefuturistics

This article gives several good tips to help you save money and plan for an enjoyable retirement. Feel free to leave your comments and thoughts on the subject.

Financial Tips for a Better Future

Taken from the Article Directory Online

In this era of credit crunch, people are going through tough time of their lives, as it is driving people out of their jobs, and causing the businesses to shutdown. People are now using their saved up money, which is consuming their savings, which they have accumulated over the years.

Saving money should be your lifestyle, but not everyone is good at it. There are ways to stretch your money and to save them in the bank accounts. First of all, we have to stop the extravagant spending and should start using our money wisely. If we start from today, we will be able to save a lot, and ultimately it will pay us back in huge dividends. Let us have a look at certain tips which can help us getting grip on our bank balance.

For a start, one must have a planned budget, which must be followed, people do not have such habits, and in this time of credit crunch, it is important to do so. When one sticks to plans, which will eventually lead to better debts payments, and savings for holidays, educational purposes, and for emergencies, and above all for carefree life after retirement.

If you keep track of your spending you would know where your money is going, and when you know where your money goes, you know where you are spending. If you limit the purchase of luxury items, which includes your usual morning coffee, you would definitely save a lot of money by the end of every month. By knowing your spending, you would avoid late or overdraft fees and interest payments on your account. Following this method with your budget will be a dynamic duo!

You can get membership of local area library to have access to movies, and DVDs at much lesser cost as compared to the video rental stores, which will help you a lot in saving. Moreover, you can also borrow books of your interest instead of buying them from bookstores.

Getting rid of the TV cable connection can be very useful in different ways. First, it will be a way to save. Secondly, people think that TV cable is one of the major ways to get cheap entertainment, and to remain informed about the happenings of the outside world. In fact, without cable TV, you can give more time to your family, and can spend holidays with them. Moreover, you can do some constructive household project to keep yourself busy . Thirdly, when there is no cable TV, one will have free mind with respect to its bill payment.

The struggling class of the society is usually the one who cannot pay their bills on time. Late payment of the bill will lead to credit payments, which will keep increasing your debt, this may lead to worsen financial standing then before. Thus, one should pay the bills on time to stay out of trouble.

By limiting the spending on luxury, you would have more money in the pocket at the end of each month. Moderation is what is required in the first place. Do not go for brand names; purchase what looks good on you. Do not waste your money on cigarettes and tobacco stuff. This will not do well but will only damage your health.

photo by mckaysavage

It is true.

“When people win, they like risk. When they lose they hate it.”

- Olivia Mellan, Investment Advisor Magazine

It is easy for an investor to set his or her risk tolerance high when things are going well, but when things aren’t going very well, it is another story.

As an investor, it is important to ask yourself, “Will I be okay if my account drops 10, 20, or even 50 percent?” This will help you determine your investment risk tolerance level.

When you set your risk tolerance level properly, you will be happy when your account is doing well, and will be able to sleep at night when it is not doing so well.

At Paragon Wealth Management, we have created a risk tolerance survey to help investors determine how much risk they can tolerate. This survey determines how conservative or how aggressive you need to be invested. Click on the link below to determine your risk tolerance.

At Paragon Wealth Management we talk a lot about having a good investment strategy, and planning ahead for times that are both good and bad. This will help you to stay focused on the long-term instead of being swayed each day by what is in the news. Below is a good article that goes along with this idea.

How to Stay Frugal and Focused in a Recovery

Written by Wojciech Kulicki (a.k.a. Wojo) at
Fiscal Fizzle

A lot of people are talking about recovery–you can feel the buzz in the air, and the excitement of many of us who have felt the pressure of the economy take a direct hit on our ability to earn an income and maintain a basic lifestyle.

However, and it’s a big however, research and consensus around the web and major money magazines seems to indicate that we have a very short memory. So short, in fact, that our national savings rates and other major spending/savings indicators correlate exactly to the economic conditions of our time.

In other words, when the economy is tight, we spend less and save a lot. When it gets better, we tend to spend more and save less.

I was speaking to a fellow blogger a few days ago, who remarked that he “doesn’t buy into the economy.” In other words, he believes that doing the right things on a personal level should be our primary concern.

I agree to a certain extent–reacting to the news of the day, especially for long-term decisions like investments, is financial suicide.

But I do believe we need to be reactive to a certain extent. As our circumstances change for the worse, we may need to contract our budget more than expected. When they get better, we may need more help being diligent with savings when everyone around us is going on shopping sprees.

To that extent, and being very mindful of our natural, “wired-in” tendencies to go with the economic flow, I have several suggestions for how to keep your “recession” state of financial mind as we come out of this mess (whenever that may be).

Why Would I Want to Be Stuck Here?

By now you might be thinking–all right, Wojciech, I see what you’re saying, but why in the world would I want to be “stuck” in a recession mindset? Haven’t we endured this long enough?

I agree–going through a recession is anything but pleasant. But let’s take a look at some of the financial habits we’ve developed as a result:

• As a country, we’ve saving more than we have in a long, long time.
• Frugality has become the buzz word of the year, as more and more people discover that value is more important that price.
• We’ve simplified, contracted, and streamlined our financial processes, businesses, and spending habits.
• Lending practices, although they have over-contracted for now, will be more reasonable for the foreseeable future.

So while a recession may not be the best things in terms of pure economic sense, it’s a great cleansing and reset mechanism for our money.

Maintenance Strategies

Understanding our run-away tendencies to over-correct in an upturn, here are some of the things we will be doing in the coming months to prepare:

• Automate as much as possible. When we remove emotional decision-making from our financial life, we can reduce or eliminate decisions that hurt our long-term success with money. Consider your current situation and determine what you can automate–retirement contributions and savings are two that come to mind immediately, but you can also play tricks with extra payments to your mortgage or something similar. The more beneficial activity that happens behind the scenes, the better.

• Cultivate a peaks-and-valleys philosophy. If you haven’t read Peaks and Valleys yet, I recommend it–it took me less than an hour to get through the book. The basic concept is that you appreciate and manage the good times, while finding and using the good in bad times. If you come to understand the book, you’ll see why saving for a “rainy day” is such an important philosophy–it helps you get through the valley and onto the next peak.

• Catch yourself constantly. One of the most valuable characteristics of human beings is self-reflection. We are uniquely capable of analyzing our own thoughts and behaviors, and changing them at will. One of the ways we can control our ascent out of recession is constant self-reflection. Ask yourself–would I have done this a year ago? Is this a responsible use of my money, or am I spending just because I now can?

• Lock in your current behavior. One way to do this is to make note of all the relevant “ratios” that you can think of–debt to income, savings to income, etc. Another practical method is to monitor your net worth over a period of months and years. Finally, taking a “snapshot” of your budget–reminding you of how much you were spending during the recession, is another fantastic mental cue to take it easy.

• Curb your enthusiasm. Yes, I realize that’s the title of a hit HBO series. But it’s also a great strategy for not getting ahead of yourself during recovery. When financial circumstances get bad, we tend to resist lowering our spending habits. When times get better, we are quick to follow with our wallets. Slow down. Maintain a lower level of lifestyle, longer. Save the difference and experience the security of knowing that there is space between your income and expenses.

If Nothing Else…

If there’s one concept I would like you to take away from today’s post, it’s to have patience and react slowly to upcoming changes. While your financial situation may be far below “normal” right now, we don’t have to over-compensate when times are good and send it above that normal level.

Instead, we need to use the excess to prepare for the next downturn, so that we can maintain our “normal” level longer, perhaps through the entirety of the next recession.

How Will You Manage Recovery?

These are only my strategies for managing our mindset and finances through an economic recovery. What are some of the things you’re planning as times get better and we face the risk of forgetting how bad it got?

photo by AMagill