Ways To Be Smarter About Your Money

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Be Smarter About Your Money Going Forward

If you are like most people there are ways you want to improve your financial habits and your financial future. If that describes you then take a look at these ways to be smarter about your money going forward.

No matter what your financial habits have been in the past it is always possible to learn new skills and make progress. Look at these ways to be smarter about your money and take from them what you can to improve your financial picture.

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1. Salary is not the same as savings. Your net worth is more important than how much money you make. It’s amazing how many people don’t realize this simply truth. Having a high salary does not automatically make you rich; having a low salary does not automatically make you poor. All that matters is how much you save out of your salary.

2. Saving is more important than investing. Pay yourself first is such simple advice, but so few people do this. The best investment decision you can make it to set a high savings rate because it gives you a huge margin of safety in life.

3. Avoid credit card debt like the plague. Carrying credit card debt is a great way to negatively compound your net worth.

4. Live below your means, not within your means. The only way to get ahead financially is to stay behind your own earnings power.

5. But credit itself is important. Likely the biggest expense over your lifetime will be interest costs on your mortgage, car loans, student loans, etc. Having a solid credit score can save you tens of thousands of dollars by lowering your borrowing costs. So use credit cards, but always pay off the balance each month.

6. If you want to understand your priorities look at where you spend money each month. You have to understand your spending habits if you ever wish to gain control of your finances. The goal is to spend money on things that are important to you but cut back everywhere else. And if you pay yourself first you don’t have to worry about budgeting, you just spend whatever’s left over. – Market Watch 

Ted Talks To Help You Be Smarter About Your Money

Ted Talks offers videos of experts in their fields who give 10 – 20 minute talks on almost any topic you can imagine. Here are two Ted Talks you may want to check out when it comes to being smarter about your money.

Shlomo Benartzi: Saving for tomorrow, tomorrow

There’s a difference between knowing you should save and actually doing it. “We think about saving,” says economist Shlomo Benartz in his TED talk. “We know we should be saving. We know we’ll do it next year, but today let us go and spend … This issue of present bias causes us to think about saving, but end up spending.”

As a result, just one-third of Americans end up saving in a 401(k) retirement plan, he reveals — and only 10% of Americans are saving a sufficient amount for the future.

Benartz delves into the why of our decision not to plan for the future. He identifies the behavioral challenges that prevent people from saving, and then discusses how to flip these behavioral challenges into behavioral solutions.

Cameron Herold: Let’s raise kids to be entrepreneurs

If you want to teach your kids to be rich, entrepreneur Cameron Herold’s TED talk will give you something to chew on. “I think we should be raising kids to be entrepreneurs instead of lawyers,” Herald says. “I think we miss an opportunity to find these kids who have the entrepreneurial traits, and to groom them or show them that being an entrepreneur is actually a cool thing.”

He shares his own childhood entrepreneurial endeavors, from starting a caddy business to buying and reselling soda pops to a bridge club of 70-year-old women. He also shares smart money habits to pass along to your kids, and touches on the contentious topic of allowances — and why you should not use them.– Business Insider

Do you have plans to change things in your financial habits to become smarter about your money?

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