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What to Do Right Now.

Here are a few things that you might consider doing right now for yourself and your family.

1. Payoff your credit card balances.  Most of us cannot do this all at once.  As you work on the minimum payments of each card, strive to pay off the lowest/smallest balance first.  Then put that paid card’s minimum payment together with the second lowest card balance payment.  Continue until all cards are paid off.  This all assumes that you will not continue to make new charges.  This reduction of expensive debt should be your first order of business.  Pay down these balances even before considering any retirement savings or stock market investments.
2. Budgeting and staying on one is lots of work.  It is harder for some than others.  Everyone should know where your hard-earned money is going.  If you do that is a good thing, because you are in the position to make changes as needed.  By knowing, you can look for ways to save money and set aside some for a “rainy day”.  One of my favorite websites that might be helpful is http://www.moneyrulesdebtstinks.com [Have fun with the process.]
3. As you control your spending and pay off expensive credit card debt, you should begin to set aside a few extra dollars.  Place your extra dollars in some type of “interest-bearing” account.  Shop around among the various banks and credit unions for the best rates.  As of July 2009, The Bank of Georgia in Peachtree City has a checking account that earns 5% on deposits upto $25,000.  Not bad when many are offering very little to nothing.  Today some of the banks are not that stable due to commercial loans losses and other bad investments.  Georgia has more than its share of failed banks.  Deposits are FDIC insured, but best to do your homework and investigate.  The general advice I hear is to work  toward a balance of 6-months of your earnings into savings.  Each of us should do what we can with what we have.  If you manage one-month of earnings in savings, you are ahead of most people.  Just keep at it consistently over time and you will achieve the amount you need and feel comfortable with it.
4. By now, you are ready to make a longer-term investment.  Today, where to place your money for the long-term is uncertain.  Many advisors and so-called experts are more than willing to “sell” you on their ideas for a substantial gains while minimizing the risk.  There a few good financial advisors, but remember that no one has a crystal ball and no one knows the future.  Do your own research.  Think for yourself.
5. A final word, whatever you decide to do, please don’t ignore common sense.  Your personal finances are really all about common sense and are not to be gambled with.  Some risk will be necessary.  After you have eliminated your high-cost credit card debt, started a family budget, and built a 6-month reserve;  you are ready to invest wisely.

Best to be prepared for whatever the future may hold.

July 20, 2009 Posted by Bill Wyler | Economy, Security & Safety | Leave a comment