| ||||||||||||
We all need money management advice, whether you’re an experienced investor or a young adult trying to purchase your first home. MassMutual’s team is here to help.
For college graduates, CERTIFIED FINANCIAL PLANNER® professional Armando (Mando) Sallavanti with Vista Wealth Solutions near Philadelphia, Pennsylvania, offers the following observations.
Q: What is the best financial advice you would give to a recent college graduate?
A: Be cautious of the "suffer now, live later" mindset that traditional financial advice tends to promote. Yes, consider starting to invest early — even if it's just $100 a month — but also prioritize experiences and relationships while you're young.
The biggest mistake I see recent grads make is thinking that they have to choose between building wealth and living their life. You don't. With thoughtful planning, you can pursue both.
Set up automatic transfers to your pretax retirement account so you're "defaulting to save" rather than hoping you'll have money left over to invest. (Learn more: Saving for retirement in your 20s: Doing the math)
But also choose to keep your expenses in check so there’s discretionary money left over for other goals, like saving for a down payment on a home, paying down debt, and entertainment.
Then, optimize everything else. For example, use travel rewards credit cards strategically (and responsibly) for everyday expenses to help fund future vacations. (Calculator: How much should I save for retirement?)
Most important, consider protecting your ability to earn income, which may be your biggest asset. Disability income insurance (DI), is designed to replace a portion of your income if you are unable to work due to a qualifying illness or injury. Coverage may be available through your employer and can be more affordable when you're younger, especially in plans where premiums vary by age.
You might also wish to consider purchasing additional DI coverage on your own. Why? Group DI insurance through your employer often provides only a minimum amount of coverage, it may not be portable, so you can’t take it with you when you leave your job, and it may have exclusions and limitations that could leave you financially vulnerable. (Learn more: 6 ways group disability income insurance through your employer may fall short)
Discover more from MassMutual…
Calculator: How much disability income insurance do I need?
How do you know if your retirement savings are on track?
Need a financial professional? Find one here
________________________________________
