I tend not to make New Year's Resolutions per say - mostly because I don't operate my life on a calendar year basis. If something needs a tweak - I resolve to fix it that minute, not when the 1st of the year rolls around. Also, 'meet more gorgeous women' is more of a hobby than a resolution.However, if you're looking for a resolution that can truly change your life - here is my suggestion: Resolve to Retire Rich.
When I co-founded Quantum 3 Investments several years ago, the first thing I said to my fellow investors was, "I don't want to retire filthy rich by myself. I want all my friends to retire filthy rich too - so we can all go have fun and be rich together." And I really mean it.
It'll be no fun for me to zip off on my private jet to Switzerland for some skiing if none of you can come with me - because you have meetings all week with your Marketing Department to discuss the new ad campaign. Or whatever.
So, resolve to retire rich. And it's not as cavalier as it might sound; you just need to dedicate yourself to investing in your retirement funds, and you'll retire a multi-millionaire. I guarantee it. It's the greatest gift you'll ever give yourself, and you'll never regret it. And if you're under 30 - you've got the biggest advantage of them all on your side: time. The greatest factor in retirement accrual is the amount of time you let your money sit and mature."But east coast mark; I have credit card bills, a car payment, and we're trying to buy a house...."
Sure, we all have those things. But if you can start small and begin making an investment in your retirement future, this routine of investing will become an addiction, and over time you'll love putting aside more and more money for yourself. A guy wrote a whole book about how to be a millionaire by cutting out one $5 Starbucks drink a week.
How to make it happen:
Open a 401k:
If your company offers a 401k and you haven't enrolled, contact your HR department TOMORROW and sign up. A 401k takes pre-taxed dollars out of your paycheck and dumps it into a personal retirement account for you. Most companies match part of the money you put in. Absolutely take advantage of this - they're giving you free money. Take it.
Open a Roth IRA:
If your company doesn't have a 401k plan, go to your local bank and open a Roth IRA. If you already have a 401k, open a Roth IRA as well. The advantage of a Roth IRA is that the money is not taxed when you take it out at retirement. Say you retire with $2,000,000 in your Roth IRA - you can take out every penny and not pay a cent in taxes. Link the Roth IRA to your checking account and have as little as $50 bucks taken out and invested each month. It's like 3 trips to Starbucks and a case of beer.
If your company doesn't have a 401k plan, go to your local bank and open a Roth IRA. If you already have a 401k, open a Roth IRA as well. The advantage of a Roth IRA is that the money is not taxed when you take it out at retirement. Say you retire with $2,000,000 in your Roth IRA - you can take out every penny and not pay a cent in taxes. Link the Roth IRA to your checking account and have as little as $50 bucks taken out and invested each month. It's like 3 trips to Starbucks and a case of beer.
Make it automatic:
Make your contributions to your 401k, IRA, or Savings Account automatic. Set it up so the money goes to your investment accounts BEFORE it ever hits your normal checking account. People will naturally spend all the money in their checking account - or as much as they can and still pay the rent. But if the money is never there - it'll be safely earning for you elsewhere. If you have to sit down and write out a check monthly, you'll find a million reasons of why you can't afford to invest that month. Make it automatic.
Increase Yearly:
Each year on January 1st, increase your 401k contribution by 1%. You'll never notice an additional 1% being gone....but after a few years, you've added considerable funds to your retirement.
Dream:
Every time you turn on tv and see one of those shows about 'Top 10 Luxury Vacation Spots' - picture yourself in those images. Salivate over those nice cars passing you on the road. Lust after that $2,000 Brooks Brothers suit. Imagine leaving a huge endowment to your church or favorite charity. If you get serious about investing, you can have it all.
Reality Check:
If you're 25 years old, make $50,000 a year, have nothing saved for retirement....but start today with adding 10% to a 401k.....you'll retire at age 65 with $3,949,913.
I'll get the jet gassed up. Who's coming with me?
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