Did you know that more than half of all Americans aren’t saving enough money for their retirement? Are you considering if you should invest your money so you can reach your financial goals faster?
If so then you’re in the right place because we’ve got the top five reasons you should grow your financial safety net through investing. Don’t worry if you’re not sure where to start because we’ve got you covered with tips along the way. So, keep reading to learn the top five reasons you should invest your money today.
- Earn Higher Returns
As you’re saving for your financial future you don’t want to let your money sit in a savings account earning a paltry interest rate. You want your hard-earned money to work harder for you with the higher returns you’ll see when you invest.
So, to build your wealth you should consider investing in something like the stock market, money market account, certificates of deposits, or bonds. There are several great options, so do your research so you can earn the highest returns that your risk assessment allows.
- Reach Your Financial Safety Net Goals Faster
Whether your financial safety net includes early retirement or not, you don’t want to reach old age and find out you don’t have any money. One way to reach your investment goals faster is through equity compensation at your workplace, have a look at how you can negotiate better investment benefits through your employer.
- Beat Inflation
The conversation around inflation seems to be everywhere these days. That’s why you can’t afford to keep your financial safety net in a savings account. You need to ensure that your money is working harder than inflation so you don’t reach retirement and find out you lost money.
- Get an Instant Raise at Work
Does your employer match part of your workplace retirement account investment funds? If your workplace has a 401K, SEP-IRA, 403B, or some other sort of retirement fund then chances are they offer a match. This means for up a certain percentage of your pre-tax dollars that you invest they will also invest a certain amount.
Some will offer 50% for up to 3% of your investment dollars. If you make $65,000 before taxes and start investing only three percent of that, you will invest $160. However, with the 50% match, your employer will also deposit $80 into your retirement account.
That’s an instant raise without having to do any extra work or pitch your boss for a raise. Consider investing so you can get a raise instantly.
- Reduce Your Annual Taxes
Many times when you contribute to certain investment funds you will use pre-tax dollars. Many times, depending on how much you invest, this could reduce your overall tax liability. If you could move to a lower tax bracket by investing then you need to do this so that your money is going towards your retirement rather than to the government.
Reach for Financial Freedom Through Investing
As you set your goals to retire someday, you need to know where you stand with your financial safety net. You don’t want to wake up at 65 and find out you could have done more if you had just done the research. And you can’t afford to risk losing out on higher interest rates causing you to not keep up with possible inflation.
So, start putting your money to work by investing. For more great information on personal finance and other topics, check out the rest of our blog.
