Written by Matt Wegner, Founder and Lead Counselor, Matt Wegner Financial Coaching, www.financialexcellence.net
Myth: My expenses will go down when I retire so I don’t need to save as much for retirement.
Truth: With inflation, taxes and medical bills, your expenses will go up when you retire so you need to be prepared!
Quite a few financial planners out there recommend a future nest egg value that will produce 80% of your current income when you draw a percentage of the dividends and earnings out of the account each month. The assumption is that your expenses will decrease by 20% when you retire and you will need less income to continue with the same standard of living.
This means when you reach retirement age, you will have your debts paid off (including your house) and your dependents are gone, with your health remaining good and your taxes decreasing because you’re pulling the income out of a tax-deferred retirement account, pension, or social security. Now, if you follow the L.I.F.E. Ladder and start early enough, you indeed should be debt free by retirement age and have fewer expenses in terms of debt. But the sad fact is, not very many of us actually follow those steps and we end up facing retirement with a huge drop in income but no drop in expenses. Actually, 43% of Americans have less than $10,000 saved for retirement. 27% have less than $1,000 saved. This is a problem. read more
- Exposing the false beliefs of the financial world
Written by Matt Wegner, Founder and Lead Counselor, Matt Wegner Financial Coaching, www.financialexcellence.net
Myth: Keeping separate bank accounts is a smart way to protect yourself and avoid money fights with your spouse.
Truth: Keeping separate bank accounts breeds distrust and helps separate spouses by encouraging money fights.
Here’s why: When you have one joint account, it forces you to talk about the money and where it is going. There is an element of accountability when you know your spouse will find out if you bought something. When you know that accountability is there, you won’t buy something that you know you shouldn’t buy. read more
Myth: Extended warranties and service contracts save you maintenance costs over time. Truth: Extended warranties and service contracts make the salesman a lot of money, and rarely pay off for you. [...]
Myth: Lottery is my best chance of becoming a millionaire. You can?t win if you don?t play!
Truth: You won?t win if you do play. Lottery is a tax on the poor.
Let?s look at the facts here. You?ve probably heard that you are three times more likely to be struck by lightning than [...]
Myth: You should avoid paying off “good debts” like home mortgages so you can get a bigger deduction on your taxes. Truth: Making any financial decision based solely on the amount of a tax deduction is a really, really bad idea. [...]
Myth: It’s smart to use your credit card if you pay off your balance each month. Truth: Even if you pay them off each month, credit cards are costing you more in the long run. [...]
- Exposing the false beliefs of the financial world
Written by Matt Wegner, Founder and Lead Counselor, Matt Wegner Financial Coaching, www.financialexcellence.net
Myth: You can get the best return on your investments by getting in and out of the market at the right times.
Timing the Market
Truth: Actively trading stocks while trying to beat the market doesn’t work!
The truth is you’ll end up buying high and selling low while trying to chase performance. Avoiding debt and sticking to a long term investment plan with proper asset allocation is the absolute best way to build wealth. read more
A good credit report is important, but a credit score is basically only needed if you borrow money. In fact, you can’t have a credit score unless you borrow money. Let’s take a look at what determines your FICO score. [...]
Myth: Car payments are just a way of life. You’ll always have a car payment. Truth: Car payments are NOT a way of life. In fact, they’re a really, really bad idea. The average millionaire drives a used, paid for vehicle. Don’t think they bought it new or paid cash for it because they have millions of dollars. They have millions of dollars because they pay cash for cars and avoid payments like the plague. [...]
Consolidating debt works much better for the bank than it does for you. [...]
Loading ...
