When planning for your financial future, there are many different factors that you must consider to ensure you can achieve financial independence. I am constantly thinking about retirement, of course, because I work for a retirement system. But, for Millennials like me, we have a hard time thinking about retirement because it’s 20 or more years away. So, how do we set ourselves up to ensure we can reach a point in our life where we can do what we want, when we want to? Here’s idea to get you started, set a budget and stick to it.
One of my personal financial struggles is what some may call “keeping up with the Jones’s.” However, it’s not that I am envious of my friends, because many of them have the same financial struggles I have like the cost of child care, house payments, and other regular expenses. I just simply want to have nice things and in our society, it is easy to get these nice things with the ease of access credit cards and such. So, what do I do to keep myself in check? I set a budget for my household and we stick to it.
When we first went set up a budget, we found ourselves still breaking the budget. So, we knew we had to try something different. We found out that a large amount of our budget was being blown on eating out. I did some research and talking with friends and, we decided to start using a cash only approach. So, we started using a cash only budget for eating out. When the first of the month comes around, we withdraw our eating out “allowance” for the entire month. If the 15th of the month rolls around and we don’t have any money left in our allowance, we don’t eat out for the rest of the month. Simple as that.
While this may seem entirely unrelated to LAGERS, your ability to budget and save money is incredibly important for ability to achieve financial security later in life. This basic cash only principle requires me to live within the means I have set for myself and, it allows me to save for the future. Those savings goals can include short term goals, like saving for a car, and long term goals, like retirement. Even though you have an avenue to retirement security with LAGERS, it will still require diligent savings and planning on your part. So, start small by setting a budget that allows you live a modest lifestyle and save for the future you.