We all know that saving for retirement and financial security are important objectives, yet neither occur naturally without planning no matter what level of income is involved. However, many individuals are overwhelmed at the prospect of developing and following a financial management strategy and as a result, fail to maximize their full economic potential. Spinnaker investment group has the experience as financial advisors to numerous Orange County residents and offers these strategies you can start today to place yourself on the path to financial freedom.

Spend conservatively

Cash flow is as important to the individual household as it is to a business. You need to know where your money goes. Begin by preparing a detailed and accurate accounting of all spending. Many people purchase items habitually and without thought and perhaps without necessity. By realizing where every dollar is going, you can then prioritize your spending and look to potential categories where there may be opportunities for savings.

Borrow wisely

In the ideal world, it would be nice to earn the money before obtaining the desired object, but that is in many cases impractical and often impossible. Ultimately, borrowing costs money, but remain mindful of the concept of good debt versus bad debt. Items that have long term value such as higher education and home are wiser choices than the accumulation of credit card debt for extravagances that are of questionable value.

Protect yourself

Recognize that life can have unexpected twists and turns, and you are not immune to them. Adequate insurance is a necessity, not a luxury. Objectively evaluate your needs based on your age, health, family situation, and lifestyle.

Save regularly

There’s an old saying for people who consistently save; pay yourself first. Whether that means setting aside a regular dollar amount from your paycheck or setting up an automatic payroll deduction option, just make it happen. Wealth accumulation begins with a consistent saving pattern.

Invest prudently

While there are no guarantees with investing, understanding the risks in terms of your particular situation and devising a strategy will allow your money to grow over time. Asset allocation and diversification are concepts that must be utilized by all investors.

Seek the advice of a qualified financial advisor

It’s important you look to someone who is qualified, but you also need to be sure you can comfortably work with them. Strongly consider a fee-based financial planner. We at the Spinnaker group look forward to assisting you in achieving all your investment goals.

DISCLOSURE

The information contained herein, while not guaranteed as to the accuracy or completeness, has been obtained from sources we believe to be reliable. Opinions expressed herein are subject to change without notice. Diversification neither assures a profit nor guarantees against loss in a declining market.