S.A.V.E. for Financial Success

I created the acronym S.A.V.E. as an easy way to remember some simple steps to create financial success.

Simplify: Life is so complicated these days that most people don’t know if they are coming or going. I once heard that if the devil doesn’t make you bad, he makes you busy. This busyness of life creates an unfocused and disorganized life. The reason why a lot of people don’t achieve more success is because they have reached what Dan Sullivan calls - a ceiling of complexity. To break through the financial ceiling you need to gather and organize all your financial documents so you can see if what you are currently doing is working for you. Do you have more than one checking or savings account open? Do you need all those credit cards? Can you consolidate some of your investment accounts? Do you have all your financial information at your fingertips?

Automate: A lot of people left on their own can’t save a dime. Most people are also emotional investors. So to overcome our human tendency to overspend, you need to automate your savings for your financial goals. This means that you should have your employer directly deposit some of your earnings from your paycheck into your retirement plan. You should also have your bank automatically take a specific sum of money each month from your checking account and directly deposit it into your savings account. It’s the only way I know how to save that works 100% of the time.

Variety: You have heard that you should never put all your eggs in one basket. This is just common sense when it comes to investing. This wasn’t so common for all the employees at Enron who invested all their 401k money in their company stock account. Variety is diversification plain and simple. Diversification requires investing in different types of asset classes, like cash, fixed income, and equity investments. If you need professional help, hire a Fee-Only Registered Investment Advisor to guide you through the investment diversification process.

Education: Unfortunately most Americans are financially illiterate. You need to make a commitment to learn about financial success. The best way to learn is to read. . There are a lot of great financial books, magazines, newspapers, and websites with great consumer friendly information. Avoid anything that smells like get rich quick books, television shows, or seminars. Make some time daily to read and invest in yourself!

Remember the 4 simple S.A.V.E. steps to guide you to Financial Success.