October 28, 2019
The Ghosts of Financial Decisions That Haunt You
Creeeeeaaak…. (a door opens revealing a dusty old rocking chair facing a broken window).
“Come in,” says a scratchy voice, but you don’t see anyone. “I have a story to tell you.”
There are scarier things around the Halloween season than just ghosts and ghouls. Vampires and witches, bats and cats, and all manner of things will be haunting the streets this year, but what if we told you that a nightmare can lurk just around the corner that will impact you every day for the rest of your life?
The financial decisions you made starting in your 20s can haunt you the rest of your life. Do you know what they are? And is there any way to release those ghosts back into the ether? What scary stories trouble you?
You Didn’t Save for Retirement
There are so many reasons people don’t save for retirement. There is the catch-22 of financial decisions – not making enough money to start with. There are entire fields, especially creative jobs, that don’t lend themselves to easily saving for retirement. Many people wait until they’re in their 40s or 50s to even start.
But this procrastination can negatively affect your financial decisions and financial future. Even if you sock away just a little bit of money at a time, saving for retirement starting in your 20s will pay off in the future. But there is good news for older Asheville residents. You can start now and catch up. After you turn 50, savings plans like a 401(k) allow you to make catch-up contributions.
You Gave Money to Your Children
Okay, we’re not in any way saying that you can’t help out your children with their education or support them as they buy their first home or any other manner of financial assistance. But where many people get into trouble is when they bankroll their children for anything from education to weddings.
The biggest problem is that people will borrow from their retirement with the full intention of paying themselves back, but that usually can’t happen at the right rate of replacement. Instead, consider other financial decisions, by ways you can save for your kids to make sure everyone gets what they need.
You Ignored Professional Advice
Professional advice is a great way to get new insight, but we so often ignore it. Why? That can be complicated. We may already believe we know the right answer or the advice might be difficult to understand or execute.
That doesn’t mean you have to employ a professional advisor, but having someone to talk to about your financial decisions may be a great way to make sure you’re doing the right things at the right time. And if you do choose a financial advisor, be sure to choose wisely. Some are not in it to help you but only themselves. But others do it because they genuinely want to help people
You may also want to consider programs in the greater Asheville area such as On Track WNC.
You Borrowed from your 401(k)
Your 401(k) is your money, right? So why can’t you borrow from it to pay certain things along the way. Maybe you want to buy a home or fund a vacation. And some programs all but encourage it by allowing borrowing and terms to pay it back within 5 years with interest.
But borrowing from yourself isn’t always the smartest move. For one thing, many people who borrow from their 401(k) will stop making regular contributions while they’re paying back their own loan. That means you won’t be able to catch up to where you left off. It can also impact your taxes negatively, both while you’re paying it back and after retirement. And, if you end up leaving the job, you have to pay it back sooner than you may have planned on.
You Avoided the Stock Market
If you’re risk averse, you may have avoided the stock market in terms of your investments. Yes, the stock market goes up and down and sometimes more down that you want, but it still is a great way to increase your investments.
If you want to keep your money safe you’ve probably heard about other investment structures that would be better. But the stock market has a lot of flexibility and there may be stocks that are worth your time and effort. And your stocks have the potential to keep growing after retirement if you leave them be.
You Only Pay Minimum Payment on Your Credit Card
Consumer debt is high in the country with the average household owing more than $15,000 on credit card purchases. And, depending on the interest rate, this can take a really long time to pay off. Many people pay only the minimum payment each month, but that can prove costly.
The best thing you can do is stop making new charges on your card. Try creating a budget that allows you to put fewer things on credit. If you can, transfer your high balances to a lower rate card. Then every month, may more than your minimum. Even small amounts can make a difference, but the more you can pay off the better.
You Paid Too Much for Your Home
Evidence shows that individuals are not researching mortgage options enough before signing for a loan. That means you may be paying more than you need to for a home. There are also challenges where people may buy a home more expensive than they can reasonably afford. But it doesn’t have to be that way.
Step one is to become prequalified to make sure that you’re able to buy the home you love. There’s no point in falling in love with a home only to discover that you can’t possibly afford to buy it. But once you do, you should be able to comfortably make payments on the home without risking your financial future in the process.
Do you want to know more about the options you have for your mortgage? Contact Zachery Adam and the team at GoPrime of West Asheville. Call us today.
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How we can help you
Although labeled an independent mortgage lender, GoPrime Mortgage, Inc. is not a one-man operation. Zachery Adam and his Team has the support of a streamlined operation, with professionals who assist in every phase of the loan process. His team includes an appraisal vendor, loan processors, underwriters, closers and even the CEO or president if needed. When you choose to work with Zachery, you get the support of his team as well.
It’s important to Zack that he and his team are approachable and can provide assistance to home buyers who are often inundated with misinformation about the financial picture and mortgage options. In an automated culture reliant on digital communication, it’s time to put the human element back into these conversations. He could never be behind the scenes.
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862 Haywood Road Asheville, NC 28806