5 Reasons Why You'll Never Be Rich [must read]

 
When is the last time that you did a financial life check?
Whether you live paycheck to paycheck or earn a sizeable salary, your financial habits may be
creating obstacles on your path to building sustainable wealth.
The path to prosperity is not driven by how much you earn, but rather the smart financial decisions that help you invest in your future.
Here are 5 ways that you may be working against your financial interest and creating a roadblock to financial freedom.

1. You don’t maximize your retirement benefits
If you are not maximizing your retirement benefits each year, then you are missing out on your financial future.
Pay yourself first.
When you pay yourself first, you contribute the maximum amount each year to your 401(k), or your IRA. If you are self-employed, then open a SEP-IRA.
But what if you have other debt obligations (like student loans or a mortgage) and cannot contribute the maximum amount each year to your retirement plan?
You don’t have to choose between saving for retirement and paying off debt. Do both.
At a minimum, contribute enough to your 401(k) to receive an employer match, and always make your required minimum monthly debt payment.
You should apply any remaining funds to whichever is higher – the interest rate on your debt or the expected investment return in your retirement account.

2. You don’t have an emergency fund
Starting an emergency savings fund won’t make you rich, but it will help protect you in a time of unexpected need.
You never know when an emergency will strike. Whether it’s an unforeseen medical expense, home repair or unemployment, don’t get caught off guard.
Be proactive. Build a financial foundation with at least six to nine months (or more) of cash to cover expenses.
Keep your emergency fund cash in its own bank account so it does not become co-mingled with cash for daily spending needs.

3. You live beyond your means
As Warren Buffett said, “Do not save what is left after spending, but spend what is left after saving.”
Living beyond your means is the fastest way to never achieve financial freedom.
Build an emergency fund, save for retirement and pay down debt. Invest in yourself first.
If you want to spend money you don’t have, it’s a recipe to deplete your savings and incur unnecessary debt.

@uptimistpeters