The top 5 things to do with your money the rest of 2021
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We went through the first half of what felt like a really unpredictable year. After a period of intense volatility due to a global pandemic, financial priorities had to be restructured. Now that we’re back to work and know what to expect from day to day and paycheck to paycheck, it’s time to review our bank accounts and decide what the best financial steps to take are. GOBankingRates spoke to investment experts for advice on how best to spend – or save – your money in the remaining months of 2021.
Prioritize professional development
After seeing how quickly jobs can disappear, it’s time to take stock of your career and decide if it’s worth fighting for. If you enjoy your job, find ways to improve yourself and your skills so that in the event of another stoppage, you have the most leverage to use to defend the necessity of your position.
“Investing in your future and your professional development is the most prudent thing you can do right now,” Adem Selita, Founder and CEO of The Debt Relief Society, advised. “You may not see an instant return on your investment, but when things inevitably change (and they can change very quickly), you’ll be that much better prepared than the rest of your peers.”
Selita recommended taking relevant courses in your field so you can learn valuable new skills.
Pay off the debt
If you have debt and are in a more stable financial situation this year than last, consider paying off as much as possible as soon as possible. Reducing and possibly eliminating the amount you owe while you have extra money puts you in a safer position should tough times strike again. It also sets you up for more success buying a car or home in the future.
Amber Morland, CEO and Founder of wincope suggested to also consider debt consolidation plans. “Consolidating your debt decreases the number of payments you have to think about each month while reducing the amount of interest you pay over the life of the loan,” Morland said. “Consider moving your debt to a zero-rate balance transfer credit card if you’re struggling with high-interest debt. Balance transfer cards are normally plentiful when interest rates are extremely low”
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If you have no debt, start looking for profitable avenues in which you can invest your money. Alli Williams, CEO and Founder of FinanciALLI focused, assured that even $25 or $50 a month can make a big difference.
“Don’t focus so much on the amount, but on building the habit,” Williams said. “You can open a Roth IRA and invest in low-cost index funds or you can contribute to your employer-sponsored 401K. The important thing is to start now. »
When it comes to 401Ks, Eden Cheng, the co-founder of PeopleFinderFreesuggests increasing your current contribution by at least 1%, saying “Investing just a few extra dollars a month can double the amounts [you’ll earn] at the end of the month,” Cheng said.
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Save what you can
It is always prudent to save in case of emergency strikes, especially after the events of last year. “2020 has been a very volatile financial year and you need to be prepared,” Williams warned. Experts recommend saving 3 months of expenses. “If you have already saved 1 to 3 months of spending in an emergency fund, is debt-free and in line with your other savings goals, you should increase your emergency fund to 3-6 months of spending,” Williams said.
To get the most out of your money, Williams recommended transferring your savings to a high-yield savings account. “The average interest rate for a traditional bank is 0.02% and the average interest rate for a high yield savings account is 0.5%.” said Williams. “There is no additional risk in using a HYSA compared to a traditional bank, and your money can earn more money.”
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Don’t forget to have fun
Getting back on track doesn’t mean giving in to routine. Part of the beauty of saving money means you can have fun without worrying about finances. Financial Wellness Educator Danetha Doe said taking vacations is crucial for relieving stress and for a better quality of life.
“Many people suffer from mental fatigue and burnout. Chronic burnout is stressful on the body and mind and can lead to serious physical problems,” Doe warned. But burnout can be alleviated by taking time to relax with a trip or stay. “Money is a tool to be used to enjoy life, so use your money to experience the joy life has to offer.”
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