Budgeting tips to help reach important financial milestones

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Achieving financial milestones, like buying your first home or saving for retirement, can often seem like a daunting task.

A WSFS Bank study of 2,005 Americans between the ages of 18 and 40 found that 58% of Millennials and Gen Z consumers are optimistic about reaching their financial goals someday, but many still have it. feeling that some common financial milestones are out of reach.

Balancing your short-term financial needs with your long-term goals can seem overwhelming, but these tips can help you budget and save to reach the finish line on your financial journey.

To buy a car

Whether this is your first car or you’re just looking to upgrade, it’s important to take a close look at your needs and come up with a budget that you can stick to. Paying for a new or used car with cash isn’t possible for most, so be sure to consider your financing options, as you may be able to find a better rate from your bank than from the car dealership. .

Evaluate the different vehicle options that meet your needs, look for the best price, and avoid the allure of all the fancy accessories when it comes time to buy if your budget is tight.

Keep in mind that supply chain issues during the pandemic have caused a shortage of vehicles available for many dealerships, so it’s more important than ever to have a plan in place to get the car you want when you need it. ‘it will be available.

To buy a house

Much like the auto market, the housing market has been hot since the start of the pandemic, and its lack of inventory makes it critical that you have your ducks in a row.

Before you start your search for your dream home, try to reduce your debt as much as possible and make sure you have a good credit rating. With homes continuing to fly off the market and many ending up in bidding wars, you’ll want to be pre-qualified for your mortgage and also make sure you have enough savings in your bank account.

Most importantly, know your financial limits and live within your means. If you already own a home and are considering moving, consider options such as refinancing and using the savings or obtaining a home equity line of credit to cash in on the value of your home and help turn it into a home equity line of credit. the house of your dreams instead of moving.

Saving for retirement

The WSFS study found that 38% of them considered saving for retirement an elusive goal. When it comes to planning for retirement, your investment strategy through different stages of life is likely to change, but you’ll want to start saving as early as possible to take advantage of compound interest.

Consider opening an IRA account or contributing to your employer sponsored 401 (k) if that is an option. The sooner you start putting money into these accounts the better, and what may seem like a small contribution will increase over time.

If your employer makes part of the 401 (k) contributions, try to maximize this matching contribution so that you don’t “leave money on the table.” It’s also important to increase your pension fund contributions over time as your salary increases or when you end up with extra money in your savings account.

If you weren’t able to contribute as much as you would like for your retirement earlier in life, you can start making “catch-up” contributions to your 401 (k) account from age 50.

Before you start your search for your dream home, try to reduce your debt as much as possible and make sure you have a good credit rating.

Fifty-eight percent of those polled for the WSFS study said they actively avoid thinking about or managing their finances for fear they will “screw it up.” It’s important to always remember that saving and budgeting is a lifelong journey and it’s never too late to start.

If you still feel overwhelmed with budgeting and planning for your future, consider talking to someone at your bank or a financial advisor, and they should be able to help you make a plan and get you started. the road to success.


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