No matter how much money you earn, or how much you have in the bank, there is always a risk that one day you might lose everything. Ask anyone in the property market during the financial crisis of 2008, or even anyone that backed stock in a company that tanks.

The simple truth is that financial crises can happen to anyone, whether it’s a big medical bill for a low-income family or legal trouble for the boss of a global business. And if you want to protect your financial future, there are a few things you need to consider. Let’s take a look at how to keep your money safe, no matter what happens.

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Create an emergency fund

Financial experts suggest that every household should have an emergency fund that will cover them for potential crises. Your emergency fund is different to your normal savings account and should contain as much as six months worth of your income. Yes, it sounds a lot – and it will take you a while to build up that pot, especially if you are starting from scratch.

Ultimately, it will give you an important buffer that can allow you to deal with any issue that comes your way for half a year – which is more than enough time to make amends. You can draw on your emergency fund for surprise medical payments, losing your job, a car breakdown – all those things in life that come as a nasty shock. And without money put aside for these normal, common crises, you will be more likely to get yourself in serious debt trouble.

Limit your risks

While the stock market is a fantastic way for investors to make more money if you do decide to play along, make sure you follow the same investment rules as people who enjoy more success than the average person. Always use your head to make decisions, and never follow your heart. Limit your risk and only invest what you can afford to lose.

Gold is a relatively safe long-term option for investors, as long as you have somewhere secure to keep it. And property is usually a safe bet, too, presuming you have a good knowledge of local markets and are prepared to see it as a full-time job. But the least risk, most sensible way of investing your money is to use the tools given to us all by the government. The FDIC protects up to $250,000 per depositor, per bank, so invest your money here first. And if you do decide to look for higher return rates, check out gilts and government bonds – they are about as safe an investment you can make

Protect yourself

No matter how much money you earn today, there are no guarantees the same will be the case tomorrow. Anything could happen – you could lose your job, get run over by the bus, or even have your job taken by a robot or artificial intelligence. So, protect your number one tool for making money – yourself – by all of the following ways.

First of all, cover yourself with things like life and disability insurance. Doing this simple act will cost you a small amount of money every month, but protect you and your family should anything bad happen to you. Secondly, get the best possible health insurance you can afford. The more fit and healthy you are, the more productive you’ll be and the more money you can make – albeit potentially. And finally, invest in yourself. Learning and education is still the biggest impactor on your potential earnings of the future, so use your brain to get ahead.

Protect your identity

We live in strange times. The Internet has opened up another world of opportunities for us in so many ways. But it’s also opened up a huge can of worms – fraud and hacking. In today’s world, you have to protect your identity if you want a secure financial future, and make sure that you are doing all you can to avoid identity theft.

Always use a credit card to shop online – rather than a debit card – as fraudulent transactions are more easily reimbursed on the former. Memorize and mix up your passwords, too, and make sure you use a different one on every site you visit. Keep an eye out for fraudulent emails, too. Many scammers are taking advantage of emails these days so it’s vital to understand what to look for.

Organize yourself

Be honest – how well do you organize your finances? Slipshod accounts and financial lifestyles could be costing you a lot more money than you might think. For example, when was the last time you checked your bank account to see how much you are paying in charges? If you move from a  $10 a month service to a free alternative, you could save yourself $120 over the course of a year – all of which can go in your savings.

Similarly, how often do you accidentally miss payments? Many people accept bank charges as a fact of life, but it’s far from the truth – it’s entirely unnecessary, in fact. And finally, if you don’t make sure that all your income and spending are properly recorded and budgeted, don’t be surprised to fall into financial difficulty at some point. It’s impossible to plan a sound financial future without a budget, so get started on one sooner rather than later!

Conclusion

In an ideal world, we would all have secure and robust finances in the future, based only on hard work and sensible lifestyles. But the reality for all of us is that any kind of financial foundation is a lot harder – and more complicated – than that. Looking after your money and preparing for the future takes dedication and discipline, but it won’t be long until you actually start enjoying it. Not only will you have a more secure financial future, but you will also start to benefit from the feeling of control it gives you. Good luck with organizing your future – let us know if you have any more tips!


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