Should You Be Investing?
When I was in 4th grade, I remember some guy from the bank came into our class to talk about compound interest. It blew my mind when he gave examples of saving hundreds of dollars a month and watching it turn into millions of dollars.
It wasn't until years later that I realized the 10% interest he kept using in his examples wasn't available at the bank he worked for. Or any bank. So if I wanted to be a millionaire, where was I going to find 10% interest for my money?
Fast forward another handful of years, and I learned about investing in the market and the benefits of mutual funds. Turns out there is a place where you can earn 10% on your money, and even more. And it's not even a scam.
But you really shouldn't invest any of your money right now. Yeah, I said it. You shouldn't be investing any of your money right now. Some people should. But you shouldn't. That is, not if you are in debt. When people try to follow a financial plan in the wrong order, it can be just as bad as not following one at all. Paying off debt and saving money should come before investing. Always.
Your debt is taking your money away from you, and it will keep doing so at a faster rate than your investments are growing over time. And, if you don't have any savings to protect your investments, you're going to tap into them when the car needs repairs. And, you're going to charge more to your credit cards when you want to buy gifts or go on vacations you didn't save up for. And, you're going to take out a loan when you need to fix the roof. All that money you were hoping would grow for you ends up costing you even more when you're unprepared for an emergency.
If you want to be prepared for emergencies, you need to get out of debt and save up a good emergency fund of 3 to 6 months' worth of expenses.
If getting out of debt and saving up that much money sounds impossible, let me show you how you have the power to make it a reality. Sign up for Financial Coaching today. Or, you can wait until your situation is even worse off and try to dig yourself out of a bigger hole. Either way, I'll be here for you when you are ready.
