Simple Tips for Financial Success
There are many methods for financial success. The single biggest key that will determine success or failure is self-discipline. Determining your path is just the first step, being able to stay on it is the real test. Spend less than you earn. If you have more going out than you have coming in, you are in trouble!
First, if you are in debt, get out of it! It may sound stupid and obvious, but before you can get ahead, you have to stop falling behind.
A good idea to start with is the "snowball" method. First, determine how much you can apply to debt reduction. Gather all your consumer debt related bills (credit cards, consumer loans, HELOC's, etc.), and lay them all out.
Pay the minimum payment on all of them, and whatever else you can pay towards debt reduction, apply to the one with the highest interest rate, so it's paid off first.
Once it's gone, then apply that payment to the next highest interest rate, and so on, until they're all gone. Make sure you don't acquire any new debt along the way if you can help it!
After you've done this (or even during, if you can), build up you emergency savings in a safe bank account. This should have at least six months of living expenses in it when you've built it up. This account is not to be touched... AT ALL!... except in cases of severe financial hardship, such as a job loss, sudden and severe illness, death in the family, or other such calamity. This is not a spending account!
Once your debt is gone and your emergency savings is built up, then you should look at retirement investing. The best advice is to do this in three steps. First, if your company offers a 401(k), fund it up to the employer match. Second, then fund a Roth IRA (or tradition IRA if you don't qualify for a Roth) up to the maximum allowed by law. If you still have more money you can apply, then go back to your 401(k) and fund it up to the maximum legal limit.
After all that, if you still have more funds to spare, then invest or save for future goals.
Get out of debt, build emergency savings, save for retirement. But most importantly, live within your means. It can be done, and you can do it.