If you’ve just recently stumbled onto this blog, you might be a little confused about how to begin investing in income-producing assets so that you can retire when you want and on your own terms. There is a lot of personal financial advice out there: your family members have their own experiences and ideas, your co-workers and friends also have their own perceptions of what people should or shouldn’t do with their money, and everyone on the Internet also has ideas an opinions on what you should do.
No one can make these decisions for you. But getting as much information as possible on the options you have for creating wealth is a great start. Read books on personal finance and investing. I have listed a couple that you can find at your library or borrow online that will give you a different philosophy on saving/investing/retirement that maybe you haven’t learned at home or from friends. Most people struggle paycheck-to-paycheck and never get ahead. They grew up in homes where parents worked hard at one or two jobs and if they were lucky they retired in their mid to late 60s. Maybe at that time they finally owned their home so were free of mortgage payments.
The story is much different today. Student loans are hampering graduates (and drop outs) from getting ahead and saving to build wealth. There never seems to be anything left over to invest so that part of personal finance always gets put off to some later date. Other people may have a 401k or other retirement plan through work and they feel the 4% contributed is going to be enough when they retire.
In so many ways, your life can change instantly: A car accident. A skiing mishap. A broken limb. A major illness. A sick kid. All too often, a person in a job they enjoy cannot go back to work. Retirement, so to speak, comes early and they are completely unprepared.
What’s the solution? My plan is work at a job I enjoy and at the same time sock away as much money as I can eek out of every paycheck and funnel that into income-producing investments. I have a retirement plan through my employer, I have a Health Savings Account (HSA) maxed out annually, money market holding accounts earmarked for rental properties and major expenses such as vehicle replacement in another 100,000 miles (or so). You have to pick the income-producing assets that work best for you and your willingness to assume risk, but there are lots of options out there for you to learn about.
Don’t believe anything I say, and don’t make any financial changes because of what you read here. Get informed, learn as much as you can about different investment options and make smart choices based on your life, your income and the future you want. But the one thing I know for sure is that what you really need to do is start somewhere and you have to start now with whatever you have and as little as you have.
It all adds up.
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