Choosing Your Investments
Almost 30 percent of Americans have reported they have a higher credit card balance than that of their emergency savings accounts. While just 51 percent have enough in emergency savings to cover the balance of their credit card debt.
And it’s no wonder. We were never taught personal finance skills during our years in the classroom. We also, unfortunately, aren’t just born knowing how to manage our money either. For so many of us, we’re just taking it one day at a time to the best of our ability.
Sometimes, this means we get our financial priorities out of order. But it’s never too late to sort them out and remedy any mistakes. Here are four smart ways to invest your hard-earned money and four that aren’t quite so smart.
Invest in This: Purchases That Help You Save
To save a lot in the long-term, we sometimes need to drop more cash than we normally would be comfortable with. For example, it might make sense in the short-term to spend a couple of bucks on coffee-to-go instead of investing in the equipment required to make that perfect cup at home. But when you add up the savings you’ll see over time, that initial investment starts to look a lot more appealing.
Other items worth the initial investment are carbonated beverage makers, an iced coffee maker, an ebook reader, and quality clothing. You’ll also find investing in technology with higher specs like RAM will last you longer than cheaper models with the bare minimum.
Not That: Convenience Items
Convenience items have a higher cost for just that—convenience. Just some examples are bottled water, coffee-to-go, takeout, memberships (especially those you don’t use), in-app purchases, ATM fees, and cheap or single-use items that don’t last. These things are great when we are in a pinch, but when we depend on them regularly we end up paying far more than we would ever plan for.
Invest in This: Your Health
Your health is one of the most important investments you can make. It is always far cheaper to spend on preventative measures that will result in less pain, disease, and discomfort in your future.
Invest wisely in a high-quality mattress, fitness you enjoy, your mental health, and services like massage and chiropractic. And of course, your oral health. You should be making regular appointments for cleanings and have a regular habit of brushing twice daily and flossing each night to keep decay and disease at bay. Regular appointments allow us to catch any signs of decay or disease early on when they can still be easily taken care of.
Not That: Gimmicky Health Claims
Many Americans take multivitamins to stay healthy. However, time and time again it has been scientifically proven that they do not prevent chronic disease or death. If you are deficient in a vitamin or mineral it is far more effective, for your health and wallet, to take a targeted supplement and make necessary alterations to your diet.
Some gimmicks can cause serious harm. For example, some DIY whitening treatments can wear away your protective tooth enamel—and once your enamel is gone, it’s gone. Over-the-counter whitening treatments can also cause damage to gum tissue leading to a receding gum line.
Avoiding expert care in order to save money can allow unmonitored symptoms to escalate. As they worsen over time they will turn into a serious infection that requires pricey treatments, or even surgery.
Invest in This: Financial Security
Financial security is peace of mind. It means having sufficient income to cover household spending, debts, savings goals, and easily cover any emergency expenses that may pop up. It means less financial, and therefore physical, stress.
This means investing a chunk of your income into a nest egg, emergency fund, retirement, and future big purchases. The surest way to make these happen is by creating a goal and, most importantly, sticking to it. Software like Intuit’s Mint and You Need a Budget makes reaching your goals through an easy, doable action plan even easier than ever.
Not That: Frivolous Spending
One of the easiest ways to sidetrack your goals to attaining financial security is through impulse purchases and straying from your budget. These purchases are often small, and in the moment feel minor; however, when you add them up over time they have a big impact. More often than not with these types of purchases, we end up regretting them or losing our excitement when we get them home with our new purchase.
Other common mistakes are only saving your leftover balance after doing your monthly bill paying. Instead, you should prioritize meeting your savings goal before doing any of your more “frivolous” spending. Another bad habit is carrying debt month-to-month by paying only the minimum balance. These habits lead to spending far more and saving far less over time.
Invest in This: What Makes You Genuinely Happy
As the saying goes, all work and no play makes Jack a dull boy. While sticking to your budget, purchasing items that help you save, and investing in your health are all critical ways to utilize your hard earned cash. But we’re not asking you to completely deprive yourself of fun either.
In fact, investing in experiences, items you positively love, and hobbies will not only make you a happier person but they will make it far easier to spend your money responsibly. When creating your budget you should absolutely have categories for some “frivolous” spending on things like hobbies, day trips, concerts, and vacations.
Not That: Keeping up With the Joneses
On the other hand, it can be easy, and pricey, to get caught up in trying to keep up with the latest and greatest trends believing that it is making you happy.
Whether it be always needing to have name brand goods, luxury brand items, designer names lining your closet, the latest model, or all of the above, this habit can be detrimental to your bank balance with little payoff.
If you are doing these things solely to keep up with appearances or to win the approval of others, the satisfaction you’ll get in return will be fleeting at best. And you’ll forever be struggling to repeat that momentary feeling.
Invest Wisely at Millenium Dental
We’ve invested, and continue to invest, in our expertise and dental technology to give you the most current, up-to-date, informed, and comfortable experience possible.
Our patients have gone out of their way to give us a solid 5-star rating on Rate a Biz—and that’s from 479 reviews!
Find out why our current patients can’t stop raving about us by booking your first appointment today.