At NJM Wealth Preservation Strategies, we believe that financial literacy is the cornerstone of a secure and prosperous future. Join us as we celebrate this April by exploring what financial literacy means, why it's crucial to your nest egg, and how working with a wealth preservation manager can empower you to take control of your financial journey.
Financial literacy is the knowledge and skills needed to make effective financial decisions. It encompasses understanding budgeting, saving, investing, debt management, retirement planning, and more.
According to a Zippa report:
However, participating in Financial Literacy Month can help put you on the path toward financial stability. At NJM Wealth Preservation Strategies, we understand that finances can be challenging, especially when you’re navigating them alone. We are here to help you focus on managing your nest egg, allowing you to utilize available resources. We also aim to help you enhance your financial knowledge and improve your current and future financial situation.
A strong grasp of financial literacy is essential for individuals and families to build wealth, achieve their goals, and navigate life's financial challenges confidently.
To better understand your current financial situation, it's important to calculate your debt-to-income ratio (DTI). This ratio is calculated by dividing your monthly financial obligations by your total take-home pay. In other words, it determines whether you're living within your means.
Begin by assessing your income, expenses, debts, and savings. Then, establish a budget outlining your monthly expenditures. For accuracy, analyze statements from recent months, including both debit and credit card transactions. This process will reveal spending patterns and highlight areas where adjustments may be necessary.
Once you've evaluated your current financial status, it's time to set clear objectives for your future. Where do you envision retiring? When do you plan to retire? How do you intend to spend your retirement years?
Ensure your goals adhere to the SMART criteria: Specific, Measurable, Achievable, Relevant, and Time-bound. For instance, you might aim to increase contributions to your retirement fund or transition from savings to a growth-oriented strategy. Putting your goals in writing solidifies them and helps enhance your achievability.
Financial literacy is a journey that evolves, offering continual opportunities for growth. Online platforms provide many resources, including blogs and podcasts, to expand your knowledge.
Additionally, consider enrolling in financial literacy courses or participating in webinars led by local financial advisors, either in-person or online. These resources cover essential topics like budgeting, debt management, retirement planning, and investing.
Enhancing financial literacy requires ongoing dedication. By leveraging available resources and prioritizing education, you'll equip yourself with the experience needed to make wise financial choices for your future.
Saving money is a fundamental aspect of financial literacy, essential for achieving your financial objectives and accumulating wealth over time. If you are still in the workforce, kickstart this habit by allocating a modest portion of your monthly income, gradually increasing it as you grow more comfortable.
To streamline the process, consider automating your savings. This approach helps minimize decision-making and reduces spending temptation, as the funds are out of sight. There are plenty of auto-saving options, such as post-tax Roth or pre-tax traditional IRAs and SEP IRAs for self-employed individuals. You'll consistently contribute towards your retirement aspirations by scheduling automatic transfers of fixed amounts monthly.
You can also take full advantage of employer-sponsored retirement plans like 401(k)s. Opt to contribute as much as feasible, leveraging the convenience of direct payroll deductions. Aim to maximize employer matching contributions, helping ensure you benefit from the full match.
Whether through an IRA, 401(k), or other retirement vehicle, seizing these opportunities helps lay the groundwork for financial stability and security.
If you haven't begun investing in the stock market yet, there's no better time than now to start.
There are various ways to construct a robust investment portfolio. Diverse investments include stocks, bonds, mutual funds, and real estate. However, the most suitable strategy depends on factors like your available disposable income, risk tolerance, and investment timeframe.
Wealth accumulation demands diversification, appropriate asset allocation, and patience. If you're transitioning from a savings-oriented approach to one focused on growth, consider entering the investment realm under the guidance of a trusted fiduciary advisor.
Navigating the complexities of financial planning can be daunting, which is where a wealth preservation manager can provide invaluable assistance. Here's how partnering with NJM Wealth Preservation Strategies can benefit you:
“As fiduciaries, our job is to foster a relationship of trust, both legally and ethically. This is what drives us, so that our client and his or her best interests are always first. We then take it to the next level and employ full transparency for both our clients and the multitudes of financial institutions we work with. Many of our clients have become like family, and we could not be more thankful for them.” - Nic J. McLeod
This Financial Literacy Month, take the first step towards financial empowerment by prioritizing your financial education and taking control of your finances.
Contact Nic and the NJM Wealth Preservation Strategies team here to learn how we can help you achieve your goals and build a brighter future.