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Financial Responsibility: 3 Things You MUST Do With Your Money

March 10th, 2012 · blog, Guest Post

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It seems that everyone has something to say when it comes to personal finance and money. We all have little tips and tricks for our money that we swear by. While not all of these tricks and tips work for everyone, there are some things that people can do with their personal finances that are pretty solid regardless of the situation. With the current state of the economy, everyone is looking for ways to better and more effectively utilize their money. The key concept behind true financial responsibility is longevity. For most of us, it is important that we find easy and effective ways to stretch our dollars and maintain a healthy financial situation into the future. Here are three areas that are absolute musts when it comes to managing your money responsibly:

When we enter the workforce as young 20-somethings, the last thing on our mind is retirement. We’re caught up in the thought of landing a job, finally having a salaried position, getting company medical insurance, getting a promotion, and staying afloat in this new reality. However, the challenges and issues of retirement are something that need to be confronted early in a young professional’s life. Responsible money management is about thinking and acting proactively. You should put money into a 401k plan as soon as you are able. Oftentimes, people will begin to consider contributing to their retirement plans long after they should have. By starting a regular contribution early, you will better prepare yourself for the future by putting your money to work earlier towards a very worthy cause.

Roth IRA
The Roth IRA is another great way to put your money towards your future. Starting a Roth Individual Retirement Account (IRA) is one of the smartest moves you can make, especially if you are able to do so at a young age. The Roth IRA allows you to put money into a protected account without having to pay taxes on that money when you withdraw it. The money will sit in the account and grow with interest rates that are significantly higher than most traditional savings accounts. The money that you contribute to your Roth IRA is locked in that account until you are of retirement age. So, you will not be able to access that money until you are over the age of 59, but it will grow tax-free and at a higher interest rate. The contribution that you make to your Roth IRA does not have to be huge and is a great way to prepare (fairly effortlessly) for the future.

Smart Stocks and Bonds
Another essential aspect of smart financial responsibility is learning to invest wisely. Entering the stock market is something that many of us will do when we have the funds and time to do so. However, there are many investing options that you can make that are safer than basic stock options. Investing in government bonds is a much safer option than investing in stocks. Bonds are sure to pay out, they just pay out at a slower rate. Sure, the stock market can make you rich, but it can also make you broke. Look into investing into some safe and conservative governmental bonds. The key is to look at your money choices in a long-sighted way. Think about what will be the best option for the future of your finances, rather than what will pay out  the most right now.


Alvina Lopez is a freelance writer and blog junkie, who blogs about accredited online colleges. She welcomes your comments at her email Id: alvina.lopez


1 response so far ↓

  • 1 Isabel // Aug 28, 2012 at 2:25 pm

    I am not good at this sort of thing but I am glad that my husband knows what to do. This is good information for when you need it.

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