When it comes to reaching our money goals, there are a few common challenges that many of us run into along the way. These challenges can sometimes make it feel like we're not making much progress, and we don’t realize it until years have gone by. In this blog, we'll look at some of the most common money obstacles people face and chat about how we can tackle them.
One big money hurdle is handling unexpected expenses. Whether it's a surprise car repair, a medical bill, or something else, unexpected expenses can really throw us off track. Putting aside some cash in an emergency fund will soften the blow of these expenses and keep them from messing up our plans. If your household relies on one income, you should have six months of expenses saved up. If you rely on two or more streams of income, then you can save three months of expenses. Save this in a safe, liquid, highest-yielding location. Reach out if you need ideas.
Dealing with debt is another common money challenge. Lots of folks struggle with credit card debt, student loans, or other kinds of debt that can make it hard to save for the future. Making a plan to pay off debt, whether by focusing on smaller debts first or by prioritizing higher-interest debts, can help us take back control of our finances and move closer to our long-term goals. I am happy to run the numbers and help you plan how to pay down debt, save on the interest, and get into a position to start saving enough to have the future you want.
A lack of money knowledge can be a significant hurdle for many people. The adage “I don’t know what I don’t know” is what I often hear. However, understanding how to budget, save, invest, plan for the future, have the right insurance, and have the right estate documents is crucial for financial success. By taking the time to learn more about managing money and seeking advice when needed, you can make informed decisions and gain a sense of empowerment and confidence about your finances.
Finally, for many people, not having enough income makes it hard to reach their financial goals. Whether it's because of low wages, a job loss, or other unexpected events, not having enough money can make it tough to save for the future or invest in the things that matter most. In these situations, finding ways to make extra money, looking for better-paying opportunities, or getting more education or training can help improve our financial situation.
In the end, there are several common financial hurdles that people face when striving to achieve their goals. However, by planning for unexpected expenses, managing debt, increasing our money knowledge, and finding ways to boost our income, we can overcome these obstacles and make significant progress toward our financial aspirations. Remember, every step forward is a step closer to your money dreams!
Alan B Faerber CFP® CRPC®