13 FINANCIAL RULES FOR YOUR LIFE
- Protection should be first and it is prudent to start protection against what could happen today before you focus on building plans for your tomorrows.
- Full Replacement. The idea behind insurance is to fully replace the item that is being insured and therefor your insurance portfolio should always be kept updated and replace the full value of your house, the entire car and the full value of anything else you insure.
- Lifetime protection. Self- insurance may not work out so you should select insurance strategies that will protect you for your entire human life value.
- Savings and investments rates of returns are important to keep pace with inflation and cost of living.
- Minimizing risk is important which can be accomplished by having a disciplined savings approach.
- The impacts of compounding taxes can be devastating to your wealth building potential and therefore strategies and products that minimize or reduce your tax burden should be implemented.
- Liquidity. Make sure you have sufficient short-term liquid savings in place before you build wealth through illiquid accounts.
- Eliminate debt. Pay off all your short term debt as soon as possible.
- Reduce taxes*. Certain assets could create an embedded tax liability on your balance sheet that would get triggered upon sale of liquidation. You should understand and know this so that you can take steps to minimize the impact of these hidden taxes.
- Mortgage selection. If your mortgage payments are too high that could impact your ability to save and protect properly and maintain a balanced financial portfolio.
- Increase gross income. Rather than only automatically compounding interest and reinvesting dividends back into the same account look into reinvesting that money into other valuable financial products.
- Save money. In order to absorb inflation and cost of living try to save at least 15% of your gross monthly income.
- Debt and tax efficiency*. Pay off credit cards each month, avoid taxes as much as possible and make sure you live within your means
CreativeNurse does not give tax or legal advice. You should contact your tax or legal advisor regarding your situation.
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