How to Discover Hidden Retirement Investments
Investing for retirement has always been a wise, albeit tricky, money management strategy. Forecasting your budget 10, 20 or 30 years into the future goes beyond tricky to impossible. The smart approach is to increase your retirement portfolio by as much as possible. A careful examination of your finances may reveal hidden funds that can be invested for retirement.
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Instructions
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How to Discover Hidden Retirement Investments
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Take a careful money inventory. Write down your actual daily, weekly and monthly spending. Keep a spending diary and record every cent spent and what it was spent on. Total your daily spending at the end of each day. Total spending at the end of each week (seven days, not five). Then total your spending for the month.
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Learn the difference between essential expenses and elective spending. Create spending lists in two columns in your spending diary. Label one column "Essential Costs" and the other "Elective Spending". Write down every necessary or fixed daily, weekly and monthly cost under the first heading. Include electricity, phone and other recurring bills paid to maintain your residence, vehicle, job and self.
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Enter every other expense under Elective Spending. List groceries under both columns--needed groceries under Essential Costs and wanted groceries under Elective Spending. Minimize your "wanted groceries" list. Work to dramatically shorten your Elective Spending list to no more than two or three items and you will have more money to invest.
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Stop handing the credit card companies your investing cash. Look at total debt. Find your credit cards and other loans with the highest interest rates. Total these and the interest paid each month. Examine ways to start paying down the debt. Shop for a single lower-interest loan to pay off the highest-interest loans. Invest the savings.
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Examine your mortgage. Calculate your equity. Consider restructuring your house payment while extracting some equity and investing it. Home loan interest rates are some of the lowest loan rates available. Use equity and interest savings, from paying off other high-interest loans, to increase your investing portfolio.
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Consider any hidden tax savings to find investment money. Review how and when you pay taxes. Try to find ways to decrease withholding taxes. Look for other legitimate ways to reduce your tax burden by selling off properties or other tax liabilities. You will then have the money to invest, instead of lending it to the government tax-free for 12 or more months.
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Tips & Warnings
Consult a trusted financial planner for guidance with getting your money house in order.
Spend wisely; save at every opportunity.
Tight money management is difficult and requires \diligence. Take it as seriously as you would take financial ruin.
References
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