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What is your financial advice for people in 2019? – Eric Seto – Medium

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Here are my top tips to improve your finances in 2019.

Have a financial plan — Approaching your personal finances in the same way a business approaches its annual planning may seem like a strange strategy, but it really does work. You don’t really need to create an incredibly detailed plan with profit forecasts for your household, but you should create a set of financial objectives for the coming year. Goal setting is one of our favourite motivational techniques– once you know where you are headed, you can work out how to get there.

Budgets — It sounds boring, I know. But if you get your budgeting right then you will have more money available to enjoy yourself, which can only be a good thing. The biggest stress you are likely to face is having a lifestyle not matched by the amount of money you are earning. Often when we take a good look at our finances, there are always things that we pay for that could be cancelled to save money. For example, unused gym memberships, Netflix subscriptions when you rarely watch it/could share with someone else, or long-standing subscriptions to magazines you no longer read. All of these little expenditures in a month can soon add up, and you are essentially just throwing money down the drain. So, stop wasting money and start saving it, or if you really cannot do that, then at least make sure you are getting full enjoyment out of the things you spend monthly money on.

Do not borrow unless it is for something big and important — debt has become such a way of life for many of us that we have forgotten the art of saving and waiting for something we want. In the finance advice industry we classify bad debt as when you borrow to fund an unsustainable lifestyle, such as for holidays or buying furniture you don’t really need. While good debt would be, for example, to buy a home. Stick to good debt, and otherwise save for what your heart desires. You will value it more for the wait and delayed gratification is good for the soul.

Risk — the amount of risk you will take with investments is something so personal, it is quite difficult to talk about generically. But one thing is for sure — you should never be taking investment risks that stop you sleeping at night.

Insurance — home insurance is one thing, and car insurance is obligatory. But for many people that’s as far as they get when it comes to insuring their valued assets in life. Failing to insure your income, your life or your health could cost you a lot more than you expect if you become critically ill. Expand your thinking on insurance towards income protection and critical illness cover. You will be so thankful you had it if something unexpected happens, and it is likely to cost a lot less than you think.

One thing you should always remember is never invest against the trend.

Anyways, I made a fun little investing quiz to help my students and new investors to identify exactly which area to improve upon. It’s a 12 question quiz. You can try it here.

If you want to learn how to get 30% from the market, I have a free training online. You can reserve your seat to watch it online here

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