While preparing a bucket list many people would not think of adding financial goals to their last minute priorities, but why not picture yourself enjoying the fun of building wealth and leaving a legacy for future generations to enjoy!
Eliminate unsecured loans, live debt free
Home loans, car loans, education loans and credit card debt top the list of household debt in the United States, and Americans were carrying a debt burden exceeding $11 trillion in 2011. Taking on loans for acquiring a home or a car and higher academic qualifications can be considered as wealth building purposes that are justified, but how do we account for unwieldy credit card balances and personal loans representing frivolous pursuits and routine expenditure? Make a major cut in your paycheck every month and pump funds into prepaying big ticket loans and closing all unsecured loans. You can sell off assets you don’t need and create an emergency fund to pull you out of financial emergencies. By crossing this goal off your list you leave a healthier financial legacy for your children.
Accelerate home loan payments, substitute rentals for mortgages
You should seriously consider refinancing your existing mortgage so that you can shorten the home loan tenure and prepay this loan. If the present mortgage is too big for your breeches consider benefiting through a short sale of the home and moving to a smaller affordable home or rental. Your family may probably thank you for your foresight, and this may release a lot of cash that can be used constructively to address other more pressing needs.
Pour more savings into your retirement fund
Surveys reveal that three quarters of Americans have an IRA balance below $75,000. If the maximum ceiling is $17,000 for the IRA, max out your contribution and watch the employers put in matching contributions. In the final analysis this would make for a very comfortable retirement even after factoring inflation. With every extra penny you donate to a retirement fund you are showing the door to frivolous expenditure today and protecting the quality of your future.
Secure a child’s future by diverting funds to high return investments
The average cost of college tuition fees is around $17,000, and within two decades this demand would increase to $40,000 if tuition rates grow at 5% per annum. Consider parking funds in mutual funds, stocks and high growth stocks that could help you grow the money at not less than 8% per annum, well above inflation. Money saved and growing in this manner could easily pay college expenses many years down the road. Helping children by reducing their dependency on loans means your kids will breathe easier.
Accumulate a disaster management fund
Cut costs in every area possible, reduce your wants, restrain your ambitions and divert every penny possible to an emergency savings account that will account for six months survival money when you face a financial meltdown. Consider this as an additional investment in your future.
Giving to a charity is as important as receiving god’s munificence
Whether you make money conservatively or in millions it doesn’t matter, give to charity what you can and watch sufferings being erased and lives being transformed all around you, when it matters.
Implement a one-time debt consolidation strategy
It’s likely that we all suffer considerably because of our impulsiveness and many bad decisions we made in the heat of the moment. One consequence is a mounting debt burden. Fortunately this can be mitigated through a one shot loan consolidation plan. Get hold of a loan for vehicle title. The car equity loan unlocks the equity lying dormant in your car. Through an auto equity loan you can mobilize sums aggregating almost three quarters of the resale value of your car. Use this money constructively and liquidate all the personal loans and credit card balances you have hopelessly accumulated. The auto collateral loan will no doubt charge a higher rate of interest at 25% APR, but resolve to treat this as a necessary sacrifice that you must repay in the short term in order to free your family from the vice like grip of unsafe unsecured loans.