It is not always easy to commit to a plan to save money and build wealth, but it is a commitment that is absolutely necessary to establishing long-term financial security. According to Kion Kashefi, far too many people focus on the here and now when they should be planning for their financial future. When it comes time for you to develop and implement a plan to save money and build wealth, Mr. Kashefi believes there are five methods that can be quite helpful.
Focus First on Reducing Debt
In order to save money and build wealth, Mr.Kashefi says, you have to first eliminate any debt that you currently hold. Debt obligations that are allowed to linger only cost more and more in the long run, so it is absolutely imperative to develop a strategy to pay down and eliminate those outstanding debt obligations so that you can begin saving money for the future.
Analyze Current Expenses
You should always be in a constant state of analysis when it comes to your current expenses, and it is especially necessary if you are currently in debt. If you have significant debt obligations, it important to carefully consider whether you can actually afford some of the luxuries that you may be spending money on. Mr. Kashefi suggests looking for and eliminating any redundancies and believes that any unnecessary luxuries should be eliminated as quickly as possible.
Develop a Savings Plan
Once a plan for reducing debt is in place and you have cut down on your luxury costs you can begin to develop a plan for savings. According to Mr. Kashefi, it is wise to set aside an automatic deduction each month that goes directly to a savings account. This will require an analysis of how much you can afford to put aside each month, but it is a worthwhile endeavor now that automatic transfers are made so simple.
Mr. Kashefi believes that meeting with a financial planner is quite helpful when designing an investment plan. When meeting with the planner, make sure that you outline all of your short- and long-term goals and make sure that you discuss the amount of risk you are comfortable with when it comes to your investment. You and your financial planner can then design a plan that is best suited to your individual financial goals.
Increase Contributions Toward Retirement
If you work for a company that has a retirement contribution program, Mr. Kashefi believes that you should maximize the contribution to this program as soon as possible. Most companies that offer these programs set a limit, and it is often best to contribute as much as the company will allow so that you can benefit well into the future from a robust retirement account.