How To Create a Winning Financial Strategy with Smart Accounting - Las Vegas Edition

Cutting Unnecessary Costs

Once you know how you spend your money, then first you can trim costs, focusing on areas where there are less fun expenses. Maybe you eat out less frequently, or you cancel unused monthly subscriptions and the like.

Little amounts can quickly add up. Put those savings toward any GOALS you might have, such as the fund for a vacation down the road, the next emergency, or the emergency you didn’t know you had. For example, if you save $50 a month on cutting out coffee shop habits, combined it is $600 a year which you could be adding to your emergency fund.

Smart Investing

Investing is one of the most powerful ways to build wealth. Before starting, understand your risk tolerance and your investment horizon. Younger people who can weather the ups and downs of the market over a long period of time might be better suited for stocks, while older individuals who are about to retire might want to put their money into something safer, such as bonds.

By 2024, there’s something for everyone, from the casual novice to the seasoned trader. Robo-advisors such as Betterment and Wealthfront will automatically manage a portfolio for a newcomer. The experienced can use E*TRADE or TD Ameritrade to trade, too – but with more sophisticated tools.

Leveraging Tax Benefits

Taxes are a huge factor in your strategy for saving money. Tax-advantaged accounts such 401(k)s, IRAs and HSAs are typically the best accounts you can have, because they reduce your taxable income and allow your money to grow either tax-free, or tax-deferred.

Additionally be aware of tax deductions and credits you might qualify for. In 2024, plenty of people will work from home or run businesses from home – there are special deductions for home offices, equipment and business expenses.

Managing Debt Wisely

High interest rates on debt are one of the major reasons why you might fail at getting wealthy. So prioritize repaying your high-interest debt (such as credit card balances, for instance) before saving for your emergency fund. If your debt is good debt and can yield a better return than the interest rate you’re paying, you might want to consider debt consolidation to a lower-interest loan.

Look at refinancing any student loans or mortgages you have and see if you can get a lower interest rate, which will save you money each month and allow you to contribute more towards your savings goals.

Using Technology

So much of modern life is centered around managing your money. Whether it’s budgeting apps, investing platforms or automation tools, there are digital tools to help with almost every part of your financial life. For example, while we talked about security breaches in the US credit reporting agencies Equifax and TransUnion in a previous episode, there are also credit monitoring services designed to help you catch fraud as soon as it happens, like the service Credit Karma.

Another area where technology plays a part is cryptocurrency. This is not an option for everyone, but you should start to learn the basic concepts if you’re considering using it as part of your financial planning.

Regular Financial Check-ups

Budget just as you would for your health: check-ups are necessary. Put aside at least a half-hour every month to go over your budget, check on any additional spending, and see how you’re doing against your goals. You will need to update your plan if your situation changes through an increase in income or decrease in expenses, or if you are going through a life transition, or otherwise.

Working with Professionals

Technology can make many financial tasks easier, but sometimes personal advice is invaluable. A certified financial planner (CFP) or accountant may be able to help you create a plan, understand a complex tax situation, and make your money work harder for you.

Educating Yourself

Proper financial decision-making demands the right dosage of financial literacy. 2024 offers a vast range of resources to help facilitate this. Many online courses and webinars are at our fingertips; there are even financial blogs one can follow.

There are plenty of good books on personal finance (Ramit Sethi, Suze Orman, Dave Ramsey, to name a few) teaching you how to set up a strong financial base.