Phil's Personal Finance Tip of the Day:
Building Wealth: Best Moves If You're 45 to 54
By Carla Fried, Paul J. Lim, Ismat Sarah Mangla, Donna Rosato and Penelope Wang | CNNMoney.com
Money magazine's Ways to Build Wealth package offers blueprints for the different stages of your life on how to achieve real financial security. Here, we offer advice for 45- to 54-year-olds.
Start saving for future expenses
During your peak earning years, you need to ramp up your retirement savings and fight the instinct to spend it.
-- Look into your future. Don't let your energy flag now.
To stay motivated to save, envision yourself in 20 or 30 years. Researchers Daniel Bartels of Columbia University and Oleg Urminsky of the University of Chicago found that people who feel connected to their future self are more willing to wait for a reward.
You can create an aged picture of yourself at Merrill Edge's FaceRetirement.com.
-- Expect to splurge. In one test, people spent 79% more on special outlays like birthdays than they had forecast.
The study, by Abigail Sussman of Princeton and Adam Alter of New York University, found ordinary costs easier to predict. Create an "extras" category in your budget.
Turn a max salary into max savings
When you're making the most, squirrel away the most. Some 40% of successful savers -- those who built nest eggs equivalent to 10 times pay -- did so by saving 15% of their incomes or more for at least 10 years, a study by Hearts & Wallets found. Here's how:
To read the entire article from Carla Fried, Paul J. Lim, Ismat Sarah Mangla, Donna Rosato and Penelope Wang | CNNMoney.com:
http://finance.yahoo.com/news/building-wealth--best-moves-if-you-re-45-to-54-160616540.html
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