Although the pandemic has put a strain on many household budgets, it hasn't been all bad news—in fact, more than five million people across the globe became millionaires during the pandemic.1 But even if you're not among this group, there are some steps you can take now to work towards building wealth and reducing your debt load. How can you show your money some love this Valentine's Day?
Pay Off High-Interest Debt
Each dollar you're putting toward debt is a dollar you cannot use to build wealth. The higher your interest rate, the longer it typically takes to repay your debt (or the more you have to pay each month to make progress). This year, if you have any high-interest debt hanging around, it may be time to tackle it. Use an online repayment calculator to see how much you may put toward your debt and how long it may take to pay off at your current interest rate.
Investigate other options for reducing your interest rate, whether a 0 percent interest balance transfer or a home equity loan or line of credit (both of which often carry lower interest rates than credit cards or personal loans).
Consider a Side Gig
Though reducing your expenses may be a quick way to gain some breathing room in your budget, in many cases, increasing your income may be a better answer. Not only may this provide you with more disposable income to play with, but it may also allow you to put aside extra toward your future retirement. If getting a raise at your current job isn't in the cards, a side gig (whether driving for a rideshare app, moonlighting at a different business, or signing up for a seasonal position at a retail store) may help you increase your income.
Invest For Your Future
When it comes to saving for retirement, your child's college education, or other future expenses, time is on your side. The longer these funds have to grow, the more you may gain over time. This means that putting off increasing your contributions until you believe you may better "afford" it could be a mistake. Even if you only increase your retirement contributions by a few dollars a week, every bit helps when it comes to setting aside a nest egg for retirement.
These three steps aren't the only ways to show your money love on Valentine's Day—but they may be a way to put you on the path to financial independence.
Important Disclosures:
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Investing involves risks including possible loss of principal.
To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing.
All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.
This article was prepared by WriterAccess.
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1 https://www.bbc.com/news/business-57575077