Financial advice changes over time, and for good reason. What was a popular decision when our parents and grandparents were young is not the best choice to make in our economy.
If you want to be an expert in the field of personal finance, you have to keep up with current trends.
That is why we are going to cover 6 pieces of outdated advice relating to money management and investments.
The main purpose of this article is to help you understand the reason why the financial industry has changed, and why the best financial advice for today‘s economy is not what was offered by the financial industry 20 or 30 years ago.
Take a look at the most common outdated financial advice, as well as smart, modern alternatives.
Stick with Your Bank
Generations ago, it was common to stay with the same bank throughout an individual’s entire financial life. However, this is not necessarily the case today.
The advice to stick with your bank is outdated because there are so many different banks out there. There are regional banks, large banks, and small community banks.
Because some banks offer better benefits than others, it’s in your best interest to shop around for a better bank when yours is no longer benefiting you.
Consider looking at the latest ratings of the best local banks. That way you can find a bank that has a solid reputation and also has good services.
You should also take a look at local credit unions and specific investment banks. They may be less popular than the big guys from the national bank groups, but they can still offer some great services for your money.
A good rule of thumb is to never settle to paying a monthly maintenance fee to keep your account open. If you’re overcharged for service fees, it might be time to seek a new bank.
Seek Loyalty Discounts
The most common advice to save money on your bills is to find a company that offers a loyalty discount. Many banks offer rewards for being a loyal customer.
While loyalty discounts can be a great benefit to staying with your current insurance company, they may not be worth as much as they seem.
The problem is that this type of loyalty discount is becoming far more common. With so many new banks offering the same services, why would you stick with the same bank?
There are now so many options out there that it makes no sense to stay with one bank. A good way to save money on your bills is to switch banks and get the most competitive rates for the service you need. That way you can get the best deal and still be able to enjoy rewards programs at other banks as well.
It’s a good idea to take a
look at the rates of other companies to determine whether you’re paying too much for your current insurance. Even with loyalty discounts, you may find that another company offers the same benefits at a much lower price.
TV is Always a Waste
There is a common belief that TV is a waste of money. This is another common piece of advice that is far too outdated. Past generations are often quick to condemn TV. It is said that you can’t learn anything from watching television.
That isn’t true at all. In fact, there are many benefits to watching TV. While it can be a waste of time and destroyer of productivity, there are benefits to watching TV. These benefits go beyond the simple enjoyment of consuming media.
Sure, you can get some type of education or something else more valuable than mindless entertainment to pass the time with. In this opportunity, though, we’re specifically talking about making extra money by watching TV.
For example, there are different
companies online that pay individuals to watch TV and other short clips. After that, they would give you a survey with a set of questions they expect you to answer.
These companies might not offer a significant sum of money, but it is something quick and easy that you can do while you’re already lazing about in your house. You’re already watching, so you might as well benefit from it.
Get a Financial Advisor
Investing in the service of a financial advisor is unrealistic advice for the average person. They can be very expensive and somewhat unnecessary for growing individual wealth.
You don’t need to hire a financial advisor. You can easily do most of the research yourself. In fact, in the era of digital economies, there are a wide variety of interactive tools you can use on the web to help you manage your own financial plan.
For a quick alternative fix to independent financial planning, use online financial tools like Personal Capital or Mint to analyze your investments and make sure you’re getting the best return for your money.
When you‘re ready to invest, you can then go through your bank and choose a few different funds for your portfolio. You can research by yourself into investment brokers that are offered by banks and other financial institutions.
Furthermore, there are now
companies that help individuals start out with investing ventures (like stocks). As such, even an ordinary person can begin their investment journey without having to spend thousands of dollars. These companies help individuals start small, with no financial advisor needed.
Chip Away Your Debt
Paying off a bit of debt at a time is not the best way (or even a practical way) to get out of debt anymore. Credit card interest rates are through the roof, and paying just a small sum at a time ensures that the debt will never go away.
If you want to pay off your credit card debts, you need to work on your debt repayment as a whole. If you have a student loan, for example, it’s a good idea to go through your budget and see where the money is going.
Then you can take a look at how much money you spend on groceries, restaurants, and other expenses that go toward your debts. By looking at the amount of money spent in these areas, you can figure out where the extra cash is going and make adjustments accordingly.
After that, it’s time to get started on repaying the loans. Once this happens, your debts will begin to go away quickly. You can set up auto–pay or bill pay systems so that they don’t pile up while you‘re making payments over time.
Fortunately, there are companies today that help with
debt relief and offer a debt payoff method that is much quicker, with very low-interest loans.
Save Emergency Funds
Emergencies come up all of the time lately, and it’s almost impossible to save emergency funds when you’re constantly in need.
There are so many different emergencies that it can be difficult to keep track of them all. Some of the most common include natural disasters, car accidents, medical emergencies, and other emergencies.
A smarter idea is to
invest in life insurance. This way, if your family experiences an emergency and you’re no longer around to help, they will have the help they need to take care of bills and various needs.
It’s also a good idea to invest in a retirement saving account plan so that you can have money saved for any future emergencies. This way, you will have a fund in hand and be prepared for the future.
Closing Thoughts
In conclusion, it’s smart to stay up to date with current advices relating to your financial journey. That way, you can keep your money working for you. Turn this outdated financial advice upside down with the smart alternatives above, and take your steps forward to financial independence!
