You know, they have a national holiday for everything…even one for aspiring millionaires. “Be A Millionaire Day” is May 20, a day for you to be motivated to make some financial plans.
It’s not all that complicated to accumulate a million dollars today. Simple, yes. But not easy for most of us.
Spending is easy, but saving is not. Isn’t there always something we need to pay for or buy? Of course. The typical American spends $1.22 for every dollar he/she earns. That’s a paycheck-to-paycheck existence.
Several surveys indicate a majority of Americans have saved very little for things like an unexpected emergency, college/education, new car or retirement. In fact, the Employee Benefit Research Institute’s annual Retirement Confidence Survey indicates a majority of Americans have less than $50,000 saved for retirement.
What’s holding you back from saving a million? Chances are, it’s your lifestyle.
It’s not one big financial decision that sets up our success or failure to be a millionaire. Instead, it’s our ordinary, day-to-day choices of how we spend a dollar. Those choices quickly become habits, habits become a lifestyle. Well, why not resolve to change one spending habit on “Be A Millionaire Day” and feather your nest egg?
Here are five habits to get started:
- Save something…anything! Even small amounts add up. So set up an auto-deduction from your checking account and add to your savings account regularly. Pick an amount that works in your budget. No budget? Build a budget, baby! Check out a budgeting tool here.
- Learn to invest. You don’t know where to start? First, open an investment account if you don’t have one. Learn about investing and find good educational tools at iInvest.org. Consider those investments that make sense for you. Developing the habit of investing helps you accumulate a bigger nest egg.
- Use the magic of compounding. To let your money work for you, start or add to a tax-deferred account – like an IRA (Individual Retirement Account), Roth IRA, 401k or 403b. To determine if a Roth IRA or traditional IRA is for you, consider the pros and cons here.
- Reduce debt. Pay off some debt, particularly student loans and credit card balances. Eliminating the interest you pay is a great savings strategy. See more tips at Feed the Pig by the American Institute of Certified Public Accountants.
- Build a good financial team. If you don’t have a financial advisor, start looking for one you can trust. Pay attention to all those initials and designations on an advisor’s resume, and match the expertise to your needs. A good place to check an advisor’s background is Broker Check. You might also want a money mentor – so you can have money discussions, form some strategies to grow your nest egg, and just bounce off ideas or “what if” scenarios.
Time to start taking control of your finances….Happy “Be A Millionaire Day” too!