Best Financial Advice – Stay Debt Free

In this modern day and age, money has become as essential as having clothes on your back and a roof over your head at night. There is no workaround; everything practically revolves around money these days. If you run out of money, you won’t be able to buy food to eat, water to drink and pay for all the other things that people need in their everyday lives. With the way things are going on today, those who do not have money to spend are in deep trouble.

Ironically, even wealthy individuals somehow end up bankrupt because they have mismanaged the money they have. You could have all the riches in the world at one point but if you do not control your urge to splurge all of your accumulated wealth you could very well be on your way to living a life as a hobo on the streets.

The best financial advice one can offer these days is to stay debt free. Even if you do have a stable source of income, there should always be a limit to the amount of cash you spend. There are certain things that people with ordinary jobs cannot afford initially like fancy cars, shiny watches and big houses but these will all come in time if you save money diligently. But with the help of third-party financers like banks which offer loans, you could purchase all of your dream items without actually paying for them right away.

The downside is that a lot of people fail to pay off their debts and end up broke and in trouble with the law. So before you decide to get a loan either to buy a house or a car or practically anything, think of your financial capability to generate the funds necessary to settle your debts first.

The only reason people get into debt is because they do not have it in them to delay their wants. The sad reality is that humans are never satisfied with what they have. There will always be something bigger, better and nicer at the store and people strive and work hard to attain these material things which they believe will make them happy.

Imagine living a life being thankful for everything that you have instead of being resentful that you are unable to buy this or that. You would be able to lead a better lifestyle wherein you could just live within your means and not have to worry about getting into debt.

No matter which book or financial expert you consult, you will most probably get the same answer. Stay debt free and live your life to the fullest.

Financial Advice on the Web

The Internet may be the best thing to happen since sliced bread, but it comes with its share of drawbacks. One of these is that every shyster in the world can get online and try to make a quick buck convincing you that they’re qualified to give financial advice or guidance. The best thing you can do when seeking for information online is to be wary. Use this as a quick briefing of how to stay safe when looking for reliable info.

Consider the source. The biggest banks and financial institutions in the world can make the nicest, coolest-looking websites, and pay the most to have them ranked highly in the search engines. On top of that they can spend the most money on advertising and get you to take a look at what they are offering. Any big bank is only going to lead you to as many different products that they can. They give you information on getting a mortgage for your home, as well as an auto loan, and a credit card. This is not an institution that has your long term financial goals in mind. They want you to have it all now so you can be under their thumb for 20 years or more.

Watch out for sponsored content. Sponsored content presents itself as real information, but instead is nothing more than a cleverly crafted sales pitch. In today’s world, you want to be savvy enough to know that what you are reading was written by a real human or is just rehashed information designed to fool the search engines. Many websites offering free financial information are full of financial keywords so that you will be looking at financial advertisements while you read the information. If you feel that an article you are making is confusing or has lots of the same words repeated over and over, you’ll want to click the back button and move on.

Stay clear of biased tips. If a company has a financial product they are trying to sell you, then the advice they will offer will be geared towards getting you to purchase the product, not with your needs in mind.

Avoid a short-term mind set. Look out for sites that reel you in with stock updates that are up-to-the-minute. You don’t want to be a day trader and this type of short sighted thinking is never good for a long term investment strategy.

The old adage that you get what you pay for applies really well online. Be careful of free advice you receive on the net and always double check that info. Paying for advice is no guarantee that you will get better advice, but it does weed out a lot of bad information.

Finding Financial Advice Online

Today, almost everyone has a computer and goes online for information on almost every subject. It is no different for financial advice. Most large brokerages, banks, and financial firms have websites where you can find advice on personal finances, on financial planning, on savings, and on investments. The websites offer tips on how to create a budget or obtain a mortgage, among other topics.

Many mortgage companies and banks have online websites where you can apply for a mortgage and receive an approval or denial during the same session. You can compare various mortgage companies, their rates, and the advantages or disadvantages of each financial institution online. Making it easier for a customer to obtain financial advice online is the goal of all the financial institutions, as they want your business.

You can trade stocks, manage your investments and savings, and get advice on personal planning, all online from the comfort of your home or office. Histories of stocks and the prospectus for each one can be found, as well as current figures for the stock market. There are credit counseling companies online where the user can obtain financial advice, debt management, and tips on how to avoid credit card debt. There is advice on how to keep good credit, repair bad credit, and to obtain credit if you don’t have any. You can get help creating a budget and learn how to stick with that personal budget.

Making it easy for customers to get help with financial planning helps companies get new and repeat business. You don’t have to go to each separate company, bank or firm to make comparisons or obtain services. You can do it all online. It doesn’t take the place of a personal financial advisor, but it makes it easier to get all the information you are looking for.

Worst Financial Advice Ever Given by Me

Last night the National Capital Financial Bloggers Association met, and we did what we normally do, swap stories and ideas about finances and the like (see the N.C.F.B.A. blog roll in the side bar for the sites authored by this group).

During these discussions the topic of time share condominiums came up and that led me to tell this story. The Worst Financial Advice I Ever Gave Most of you know that I am very unlikely to give you direct advice in any financial area, and this story is one of the reasons why.

My wife, myself and some friends went on a vacation to Florida (this was about 17 years ago). My Father In Law had told me about how if you go to a Timeshare Condominium sales pitch, you can get free tickets to some of the sites around Orlando, which sounded good to me (Free is always a good price). We found that at the Motel we were staying there was an entire courtesy desk filled with Timeshares offering this deal, so we signed up for a “sales demonstration”.

Off we went to this sales pitch, and it was hilarious,and surreal. I must mention one of my friends on this trip was Michael James on Money himself and his wife, so we were sure we weren’t going to buy. The salesman (who we nicknamed “Ray Don Bob Ron Don”, don’t ask why, but it was funny), tried all the sales pitches:

  • Slow playing us to see if the condo would sell itself (it didn’t)
  • Pandering to our wives about how there was little or no housework (they laughed)
  • Telling the men they could rent whenever they wanted (I asked if we could get to stay during Daytona 500 week, he said yes, I laughed)
  • How much money we’d save (we in turn figured out how much money they were making per building on the initial sale, and then how much they were going to make per year on their service fees).
  • Finally asking, “Would you buy this place for nothing?”, and then saying, “OK your price is between FREE and our selling price”, which always makes me chuckle.

I must admit that we played along and acted very much out of character (worrying my wife a great deal), but at the end, there was no sale, we got our free tickets and we left (our salesmen grumbling about how we were, “… too analytical…”. I was struck by how the people at the sales pitch “closing” room looked like deer in headlights while paying for their time share with their Credit Cards, a very disturbing site.

Fast forward a few months and a dear friend was off to Orlando with his new wife, so I told him the story about getting free tickets for a theme park and all you had to do was sit through a timeshare sales pitch. He said he’d think about doing that, and nothing much more was said.

My friend returned from Orlando a week later, picked me up to go to work and he told me all about his trip. I asked had he gone to the timeshare sales pitch, and he confirmed that he had. I then railed about how pathetic the sales pitch was, and what kind of an imbecile would buy one of those things, etc., etc., etc., for about 5 minutes.

Once I finished, my friend said in a very small voice, “We bought one…

The car ride to work was very quiet that morning.

From that day, I always shy away from giving anyone any financial advice directly, I will tell them what has worked for me, and let them decide for themselves.

Do You Know Where to Look For the Best Financial Advice?

If you spend any time trying to learn about the stock market, you know that there is a lot of advice out there. Turn on the financial news networks, read the books and articles, or talk to investing friends and you know that one thing is for sure: Even though financial advice is abundant, good financial advice is hard to find. Let’s look at how you can sift through this advice to find something that is useful.

First, don’t try to become an expert in all areas of investing. Unless you’re a full time investment professional, you probably have other responsibilities during your day. Pick areas that interest you and take some risk in those. For the rest, safe, dividend paying stocks held for the long term will be where big money is made.

Maybe you’re a technology junkie. You read all the magazines and once Apple puts out a new iPhone, it’s no surprise to you because you have read about it for 6 months. If that’s you, find a higher risk stock that could make you tons of money in the short term. If you know nothing about oil, let somebody that you trust and who has a consistent track record of success guide you in your diversification efforts.

Next, remember that while much of the media is committed to providing accurate information, they are first committed to gaining readers, watchers, and followers. Stories are geared towards holding your attention and for that reason, they are often over sensationalized. Listen and evaluate the financial media but be very careful about making investment choices solely based on these stories. Some media personalities will show a proven track record over time. If that is the case, stick with them. Read their blogs and focus on what they say. You don’t, and probably shouldn’t, read everything.

If you don’t believe you can sift through all of the financial advice coming your way, consider subscribing to a service like Action Alerts Plus where an expert like best selling author and CNBC commentator Jim Cramer is doing your research for you and all you have to do is buy and sell when he tells you to execute the trade. My secret is that I don’t have enough time to do all of my research so I let Action Alert Plus do it for me.

The world is on information overload and knowing which stocks are right for you is tough. Action Alerts Plus is one way to put confidence back in your investment choices.