Money Girl covers 7 critical investing rules to help make your money grow safely--and ensure a happy financial future.
Investing Rule #5: “Keep an Eye on Taxes"
"Take advantage of tax-deductible retirement accounts and understand the impact of your tax bracket when investing outside of tax-sheltered retirement accounts.”--Tyson
Investing through a retirement account, such as an IRA or workplace 401(k), comes loaded with advantages. Traditional accounts allow you to defer taxation until retirement. Roth options require tax on contributions, but allow tax-free withdrawals in retirement.
Additionally, many employers offer additional retirement matching funds, which is free money that no eligible participant should turn down.
Investing Rule #6: “You Are What You Read and Listen To"
"Don’t pollute your mind with bad investing strategies and philosophies. The quality of what you read and listen to is far more important than the quantity.”--Tyson
That’s why I’m glad you’re reading or listening to the Money Girl podcast! It’s so important to seek out good information, stay motivated, and to make small, incremental progress toward achieving your financial goals.
Few people achieve instant financial success. For most of us, building wealth is a slow journey that involves putting small amounts of money aside on a regular basis.
Investing Rule #7: “Your Personal Life and Health Are the Highest-Return, Lowest-Risk Investments"
They’re far more important than the size of your financial portfolio.”--Tyson
I couldn’t agree more. If you have money, but can’t enjoy it because you've allowed your health or personal relationships to deteriorate, then it won’t bring you much happiness. So consider health your first wealth and protect it fiercely by reducing stress and getting plenty of exercise and sleep.
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Eric Tyson, MBA, is an internationally acclaimed, bestselling personal finance author, lecturer, and advisor. He is dedicated to teaching people to manage their money better, and to successfully direct their own investments. Eric's most recent title, Investing For Dummies, 7th Edition, is a resource on all aspects of the topic, including how to develop and manage a portfolio, invest in stocks, bonds, mutual funds, and real estate, open a small business, and understand the critical tax implications of investing decisions.
Permissions: Excerpted with permission from the publisher, Wiley, from Investing For Dummies, 7th Edition, by Eric Tyson. Copyright © 2014.
Betterment LLC is an SEC Registered Investment Advisor. Brokerage services are offered by Betterment Securities, an SEC registered broker-dealer and member FINRA/SIPC. Investments are not FDIC Insured. No Bank Guarantee. May Lose Value. Investing in securities involves risks, and there is always the potential of losing money when you invest in securities. Before investing, consider your investment objectives and Betterment's charges and expenses. Not an offer, solicitation of an offer, or advice to buy or sell securities in jurisdictions where Betterment and Betterment Securities are not registered.
Investment of Money, Savings Piggy Bank, Tax Shower, and Inflation Percentage images courtesy of Shutterstock.