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Work & Money

Four Money Moves You Shouldn’t Delay Another Day

We’re all guilty of a little financial procrastination. Here are easy steps to take back control.

Put off your diet — we won’t tell! But when it comes to our money, procrastination can put us on a quick path to being broke and stressed. One reason people delay dealing properly with our coins is because we get a sense of instant gratification when we spend our money today rather than plan for tomorrow, says Dana Branham, a financial adviser based in Lexington, Ky. “It’s difficult for a 40-year-old to think about what’s going to happen at 55 or 65,” she says. Here are four money habits to quit today — and easy ways to get going on the path to prosperity:


  1. Putting off building an emergency fund

Monica Parker, 39, of Dallas, didn’t worry much about building an emergency fund because she had another plan. “When my bank account was low or empty, I’d just swipe my credit card,” she says. It wasn’t until she’d racked up a $9,000 credit card balance that she realized her plan was a fail. To remedy the situation, she started saving $50 per month and increased her savings every time she got a raise. A well-stocked emergency fund not only helps you avoid debt, but it can also buy your freedom. I once watched a coworker leave a job she hated because she had enough savings to finance her leap.

To take back control: Make saving hassle-free and systematic by having a portion of your paycheck deposited automatically into your emergency fund.


  1. Putting off saving for retirement

Retirement often seems like such a far-off goal that it’s easy to think we have plenty of time. But here’s a reason to stop putting it off: the longer you wait, the more of your monthly budget you may have to save when you’re older, Branham says. If you invest $100 a month and get a 7 percent return for 30 years, you’ll end up with $122,820. But if you start later and only save for 20 years, you’ll need to save twice as much each month to come up with a comparable amount. Contributing one more percent of your paycheck now may save you money — and stress —down the road.

To take back control: Create a road map with our retirement calculator.


  1. Making only minimum payments

 Making minimum payments can be tempting because we’re keeping more money in our pockets. But in reality, we end up spending more on interest and taking longer to get out of debt. Ty'Lisha Summers and her husband Kiley had about $100,000 in debt between student loans, car notes and credit cards. They were making minimum payments until a visit with a financial adviser encouraged them to act. “By continuing to make only minimum payments it would have taken us over 100 years to pay off our debt, and we would have spent $300,000 in interest,” Summers says. The couple found an extra $50 per month to start whittling down the balance faster.

To take back control: Consider consolidating credit card balances onto a zero-interest card.


  1. Putting off estate planning

When Prince died a couple of years ago, we were shocked to learn that His Royal Badness didn’t have a will. But you don’t have to be a wealthy celebrity to have possessions that you want to pass down. Not only does estate planning ensure that your assets go to those you love but it prevents your property from falling into the hands of a distant relative or even your state. Sites like legalzoom.com and willing.com can help you get started putting down your wishes and creating generational wealth.

To take back control: Look into online software or ready-made forms.

 

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