Saving for the future video
So, you’ve landed a good job - - and are finally making a decent salary. It’s time to start saving for the future. Your first house, a new car, even time to save for retirement.
But you’ve also got to pay off your student loan debt and maybe some credit card debt. How can you save for the future when you’re still paying off the past?
Here are some things to think about.
First, remember most student loans and mortgages – if you have one – usually charge lower interest rates and can be tax deductible. So it may make sense to initially pay these loans over time as scheduled, instead of paying extra to pay them off early.
When looking to pay off debt, concentrate first on non-tax deductible debt - - like credit cards. This is the debt you want to pay off as fast as you can. If you have multiple credit cards, pick the ones with the highest interest rate to tackle first.
And make paying things off as easy as you can. Sign up for automatic payments on your credit cards and other bills. That way, you won’t accidentally fall behind and get hit with extra interest or late payments.
One of the best ways to invest for the future is to contribute to your 401(k) or other retirement plan through work - - at least up to the employer match if offered. Don’t leave money on the table. That’s because time itself can be a valuable asset.
Take this example. See the difference in what you would have saved by age 65 depending on when you began investing. Saving the exact same amount each month, you could be looking at over $300,000 more if you had started five years earlier.
Want more help on how to start saving for the future? Talk to your local Edward Jones financial advisor. They can help you explore all your options and work with you to put a strategy in place.