Money Monday: 5 Questions About 2016 That Will Help You Prosper in 2017

BY: - 12 Dec '16 | Money

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As the year roars to a close, it’s only natural to think about what lies ahead in 2017. Before you look forward, however, consider taking time to reflect on the year that was. Answering a few simple questions about 2016 could put you on the right track to a prosperous 2017.

What did you learn from 2016?

Celebrate your victories. That’s right, pat yourself on the back for all you did accomplish financially in 2016. Gloat. Make a list. Maybe you set up a 401K account at work. Perhaps you started following a monthly budget or cut down on frivolous spending. Whatever the financial win, take the opportunity to celebrate it.

At the same time, be willing to learn from your mistakes. Of course, we’re all afraid to admit our mistakes. They seem like sign posts, pointing directly to our weaknesses. But, instead of fearing mistakes, learn to appreciate them, for your mistakes are the exact learning opportunities that will make you more successful in the future. What were your biggest financial blunders in 2016? How will the lessons from these mistakes help you in 2017?

Where are you now?

Take stock of your current financial situation. Before you move forward you must understand where you stand now. Exactly how much debt do you have? How much are you bringing home? Most importantly, calculate your net worth.

Your net worth is the sum of all of your assets minus the sum of all your debts. Assets are things of value like your home, cars and saving accounts. Debt is everything you owe, whether it be your mortgage, credit card debt or student loans.

Your net worth is the score card you’ll use to monitor your financial progress. Your goal in 2017 will be to make moves that increase your net worth.

Where do want to be?

What does financial freedom mean to you? Do you want the freedom of having savings in the bank, money in your retirement account or the ability to take a vacation whenever you like? Whatever your vision, you must write it down. You must turn your vision into a goal with a real deadline, otherwise your vision becomes nothing more than a dream. I suggest turning each one of your financial desires into a SMART goalSpecific  Measurable  Authentic Realistic  Time limited.

Don’t just decide that you want a new job that pays more. Instead, your SMART financial goal should state: I will obtain a job in my field of work that pays me a minimum of $70,000 a year; I will find this job within the next eight months.

Instead of deciding that you will buy a home in the future, turn your desire into a SMART goal:
I will purchase a home located in a good school district within a 40 minute commute of my job. The purchase price will be between $250,000 to $350,000, and I will save $50,000 for a down payment. I will purchase my home within three years.

What are you willing to give up?

We often have a clear picture of what we desire, but we never take a close look at what we’re willing to give up to get it. Perhaps you want to start your own business, but you spend two to three hours a night using Facebook or watching Real Housewives of Atlanta. Until you decide to give up something less valuable to you (using Facebook or watching television) to obtain something more valuable to you (time to start your own business), you’ll always be in the same place. Take the time to decide what you’re willing to give up to obtain what you truly desire.

What is keeping you stuck?

In any potential endeavor, there is always one sticking point—one hurdle that if we overcame would make achieving our goal attainable. Perhaps you would like to start your own business but have been procrastinating getting a business plan together.

Maybe you’d like to start investing but don’t know the difference between a stock, IRA or 403b. You’d like to get a raise but still fear taking the exam for the certification that would lead to your promotion. Think hard. Identify the one thing that is holding you back, and decide to attack it with everything you have in the new year.

Use your reflections of the past year to springboard your efforts in the new year. Most importantly, believe in yourself. Give yourself permission to make 2017 your best financial year ever.

BMWK, what do you plan to do to make 2017 your best financial year yet?

About the author

Alonzo Peters wrote 286 articles on this blog.

Alonzo Peters is founder of MochaMoney.com, a personal finance website dedicated to helping Black America achieve financial independence.

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15 Easy Ways To Take Your Money Game To The Next Level in 2017

BY: - 26 Dec '16 | Money

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We hate rules. Maybe it’s the rebel inside all of us. But, if you really think about it, rules serve us well. They keep us safe. They help us achieve our goals. Rules of the road, for instance, ensure that we’ll arrive at our destination safely without accident.

There are rules to the money game as well. Unfortunately, too often we ignore them resulting in financial carnage. But if you follow some of these money rules, you’ll achieve financial success. Consider these financial rules for a prosperous 2017.

1. Pay yourself first.

YOU are the most important person in your financial universe. Unfortunately, we pay everyone else first, leaving only leftovers for ourselves. Make sure the first payments of the month are used to fund your financial priorities. Then worry about everyone else.

2. Remember, it’s not how much you make, it’s how much you keep that matters.

We’d all love a high paying job, but earning a large salary will not necessarily make you rich. Likewise, bringing home a meager salary will not keep you from achieving financial prosperity.

3. The true path to wealth is found in spending less than you earn.

Use what’s left over to pay off debt or to build money producing assets like stocks, bonds, savings accounts, or your own business.

4. Lifestyle inflation will gut your financial dreams.

As we earn more money, our tastes become more expensive. It’s almost inevitable. We trade McDonalds for Five Guys Burgers, Target for Macy’s, and our Toyota Camry for a Lexus ES. And in the process, we end up spending just as much as we earn…ruining any ability to create wealth.

5. The true scorecard to financial success is your net worth.

The scorecard of financial success is not the size of your home, labels on your clothes, or brand of your car.  Net worth is the value of your total assets minus your total debts. No matter what stage your financial journey, you should always strive to increase your net worth.

6. Your willpower is fragile.

That’s not a criticism. It’s just human nature. In the end, we too often give in to financial temptations. That’s why it’s important not to rely on willpower alone. To get ahead financially, put your financial life on autopilot. Automate your savings, your 401K contributions, and your bill payments.

7. Stop leaving money on the table.

Have you had a car accident in the last year? If not, why are you paying the same insurance premium? Too often we fail to shop around for the lowest rates on insurance, cable television, cellphone plans and a host of other services.

8. Invest in your greatest asset.

You are your greatest asset. You, with your knowledge and skills, create your income. Therefore to increase your income you need to invest in you. Increase your knowledge. Learn new skills or earn new certifications that will allow you to command a higher salary.

Control your money or your money will control you.

9. Pay attention to the big purchases.

Get the big purchases right – transportation and housing, and you’ll be way ahead in the financial game. Unfortunately, people continue to buy more house than they can afford. They spend little time searching for the best mortgage rates and they spend more time planning their weekend than researching a $35,000 automobile purchase.

10. Run your own race.

You’ll never get ahead trying to keep up with your neighbor who is drowning in debt financing her new Mercedes. Don’t worry about the Joneses. Worry about your finances.

11. Give every dollar a purpose.

Give your Washington’s, Jefferson’s, and Benjamin’s their marching orders. Tell each and every dollar where it is going. Remember, control your money or your money will control you.

12. Understand that experiences will always trump material possessions.

When you sit down with friends and reminisce, do you discuss the things you purchased, or do you relish the time you spent with friends and loved ones? Experiences always appreciate in emotional value, while material possession almost always depreciate in monetary value. So if you have the choice between buying a new toy or going on a trip, for instance, chose the trip every time.

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13. Don’t be afraid to earn more money.

Your ability to earn money is only limited by your imagination. We all have talents and experiences that others would be more than willing to pay for. A side hustle is the perfect opportunity to offer your talents to the world.

14. Invest as early as possible.

Compound interest has been called one of the most powerful forces in the universe. It is what allows small investments to grow over time. However, for compound interest to multiply your savings, you need time. The earlier you invest, the more time you allow compound interest to increase the size of your investment.

15. Realize that your kids are always watching you.

They are learning from both your success and mistakes. This may provide you with the greatest incentive for practicing great money habits, as these habits will become the basis for your children’s financial practices in the future.

BMWK, what are some of the money rules you follow to achieve financial success?

About the author

Alonzo Peters wrote 286 articles on this blog.

Alonzo Peters is founder of MochaMoney.com, a personal finance website dedicated to helping Black America achieve financial independence.

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