A very recent article from Business Record (a central Iowa business magazine) sited that 30% of Americans have an outstanding loan balance with their retirement account. What makes it even worse is that 60% of Americans are not even saving for retirement (according to a Scott Trade study) because of non-mortgage debt. That does not leave good odds for having money at retirement. I think it is safe to say that this is a recipe for a financial mess. Is there a way out of any financial mess without touching your nest egg? Yes and here is how.
I had a client tell me that before seeing me, the client pulled out $150,000 from their retirement account. That decision resulted with a $75,000 tax bill to pay for all the taxes and penalties that came from this early withdrawal. At the end of the day there was deep regret in that decision, but life still must go on.
When you are in debt and have little to no savings, the first thing you need is a plan. Maybe a better way of saying it is you need a road map. Here is a silly question for you. Have you ever been somewhere you have never been before?
The obvious answer is yes. How did you get to this new destination if you have never been there before?
Most of us would use a GPS device, Google Maps, maybe even the good ole fashion atlas and some of us (dare I say it) would ask for directions from someone that already knew the way. Some of us, however, do this by the dead reckoning approach. That may work sometimes when it comes to traveling, but it never works with money.
The road map I recommend financially is called the baby steps. If you don’t know by now, the baby steps are from Dave Ramsey. But even he will tell you that all the financial advice he gives is from God and your grandmother. It wasn’t a magic formula that just fell into his lap one day. I have personally seen the emotional, relational, spiritual and financial transformation when these steps are used as the financial road map of life. The baby steps are as follows.
Baby Step 1 – $1,000 starter emergency fund
Baby Step 2 – Debt Snowball
Baby Step 3 – An emergency fund of three to six months expenses saved
Baby Step 4 – Invest 15% of your income for retirement
Baby Step 5 – Invest for your children’s college
Baby Step 6 – Payoff the house early
Baby Step 7 – Build wealth and give
The bottom line is this. This time tested formula absolutely works. The trick is sticking to it no matter how life is treating you at any given point.
The definition of insanity is doing the same thing over and over again and expecting different results. If you keep doing what you have been doing, you are going to be getting what you have been getting. It is okay to say, I need help and directions on how to get where I have never been before…DEBT FREE!! If this is you, NOW is the time to take control of your life. What are you willing to do to win? If you follow these steps, you will win every time. If this seems like a daunting task find out how Strong Tower Consulting can turn your fear into hope!
|Ribbon Cutting/Open House
|In celebration of Strong Tower Consulting’s successful first year in business, we held our first ever ribbon cutting/open house. We had a great turn out, and we could not have asked for a better event. Below is a picture of the many that attended. You can see all the pictures of this event here.What Others Are Saying!
Words from another hope filled client!“I was referred to Strong Tower Consulting by a dear friend. I had gone to her house in desperation and tearfully shared my story. I was in debt. I had a good job with good pay but I was still living paycheck-to-paycheck and had nothing in savings. I was sick and tired of being sick and tired. I felt helpless and hopeless. She listened and shared her “money story” and offered me some possible solutions – one of them was, Justin Bennett, Strong Tower Consulting.I met with him – and it has changed my life. Working with Justin’s support and guidance I’ve been able to:
Taking the time to work with Justin at Strong Tower Consulting is one of the smartest decisions I’ve ever made.
Thank you again so much for your help and guidance!”
Audrey Upah – Ames, Iowa