By: Nicholas Licouris
Investment Advisor Representative
The craze of Black Friday and Cyber Monday is over and we look back and to reflect on the path we have taken over the past year. Many of us are excited to make life changes and promise ourselves we will improve this year. Financial resolutions are often one of highest priorities on many peoples lists of resolutions for the next year, the idea of “spend less, save more” promises that never seem to make it past the first few months. Here are a few easy steps to get your finances on track for 2018.
Start with Budgeting
Budgeting is one of the most important items to start your financial plan with, as it gives you a visual of the flow of your income. Monitoring your income and expenses can help you increase your net worth.
1. Begin with creating a realistic savings goal for each month. Ensure that this strategy will work for you.
2. With help from a financial planner, determine how much you will be expected to save in order to meet those goals (Retirement, House down payment, College Education).
I encourage putting away a minimum of 10% of your gross pay into your investment accounts (including retirement & medium term accounts.) Ideally, being able to save 20%-30% of your gross pay is an excellent goal to have.
Emergency Fund & Making Your Savings Work Harder for You
Depending on your profession, you should have anywhere from 3 to 6 months of emergency expenses in your bank account at all times. This allows for you to have access to cash immediately in case an unforeseen event occurs, and you will not have to tap into your investments. Once you have enough saved, it is important to get that excess money to work hard for you. You work hard for your money, it’s time for your money to work hard for you by not leaving it earning pennies in the bank. If you were to leave your excess money in the bank you will be actually losing out to inflation over time.
Paying off the Credit Cards Monthly:
While we all love to get our travel points, leaving a remaining balance that's getting dinged by outrageous interest rates these days (10-25%) is not a smart move. This will hinder you from saving and investing your money over time. If you find yourself over spending each month, go back to your budget and see what you can cut back on. By letting your balance accrue interest you are hurting your chances of building your emergency fund and the ability to start to save for your financial goals. Make it your mission to fully pay off your credit cards every month.
Working with a Financial Advisor:
The beginning of the year, it is a great time to look at your overall investments and ensure they are still aligned with your overall strategy to pursue your financial goals. This is a perfect time to work with a professional investment advisor to help determine your risk tolerance and run projections to make sure your still on track for your goals in life. Gerber Kawasaki prides itself on being able to help anyone who wants to get ahead in life and have designed two programs to do this. Our Wealth Building program for individuals and families that want to get started investing and teach them ways to manage their assets while pursuing their life and financial goals. Our Wealth Management Program focuses on established individuals and families seeking custom portfolio management services, comprehensive financial planning, retirement income planning, family insurance protection and estate planning.
Being on top of your finances will allow you to have peace of mind that you’re on the right track to pursue your financial goals and financial freedom. Start your 2018 off right!
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Gerber Kawasaki Inc, a registered investment advisor and separate entity from LPL Financial. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which course of action may be appropriate for you, consult your financial advisor. Investing involves risk, including loss of principal. No strategy assures success or protects against loss. Gerber Kawasaki, 2716 Ocean Park Blvd. #2022 Santa Monica, CA 90405. Contact us at (310) 441-9393.