Boost Your Financial Peace of Mind This Month
April is Financial Literacy Month and a good time to check in on your finances. Understanding key financial principles can help lower your stress, and not just when it comes to money. Other areas of your life may feel easier to manage once you’re more comfortable in your financial decision-making.
Here are some tips to set you on the path:
1. Spend mainly on needs
How much do you spend on things you really need versus items you want? Take some time to weigh the differences. While you may treat yourself to purchases you want, maintaining a balance with those you need is key.
2. Borrow to build future value
Not all debt is the same. Making purchases on credit cards, for example, can lead to months or years of payments if your balance isn’t paid off and the interest keeps compounding. The burden of paying back what you spend on an item may not be worth it.
By contrast, when you borrow money to continue your education or to buy a home that may appreciate in value, you’re not just borrowing—you’re investing in your future. Taking on debt for those reasons may be more worthwhile in the long run.
3. Protect your assets
One way you can protect yourself financially in the short and long term is through insurance: life insurance, homeowner’s or renter’s insurance, long-term care insurance and others. It’s a good idea to familiarize yourself with coverage that could potentially save you money, protect you in the event of an emergency and ensure financial security for your loved ones.
4. Save for retirement
It’s never too early to set money aside, and it may be easy to get in the habit if your employer offers a retirement plan. You can contribute a set amount or percentage of your paycheck, and you may be able to increase it at regular intervals. An added encouragement: The amount you contribute may also help reduce your taxable income.
This Financial Literacy Month, give yourself credit for any lesson you learn or action you take. Check out the Mutual of America Learning Center and retirement calculators to make the most of your finances.
The tax information contained herein is for informational purposes only. You should consult your financial adviser or attorney regarding your individual circumstances.
Information and interactive calculators are made available as self-help tools for independent use and are not intended to provide investment advice. We cannot and do not guarantee their applicability or accuracy in regard to individual circumstances. All examples are hypothetical and are for illustrative purposes only. We encourage individuals to seek personalized advice from qualified professionals regarding all personal finance issues.
