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You work hard to earn your cash each month, so you want to be reassured that at least in the future, all those years you have contributed towards taxes will eventually pay off. Putting money aside as soon as you start working is the ideal way to ensure that you will be able to retire later on in life knowing that you have a pot of money that will allow you to love comfortably. Ideally by the time you are in your 30’s you want to be able to save around twice your salary so that you can accrue enough funds by the time you reach your mid 60’s.The sooner you have financial plans in place, the better. 

Assess Where Your Money Is Being Spent

If you are saving towards a particular goal and need to reach a specific amount, then the first place to look at is your monthly expenditure. Determine where the majority of your money is being spent on and see if there are any areas you can reduce. For example having a gym membership that realistically you know you will not use, when you can go for a run instead which will not cost you a thing might be worth getting rid of. 

Put Money Aside In a Long Term Investment Account

Ideally you want to have a long term savings account where you can deposit money and allow it to build over the year so that it accrues interest. The longer you leave it in for a fixed time, the better. This will allow you to build up a nice sum without having to do anything. 

You would also need to have a separate account for everyday expenditures so that you do not lose any accrued interest in the long term savings account, by withdrawing cash before the minimum maturity date. 

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Invest In Stocks and Shares

If you have some money set aside that you are happy to invest with, then you could buy shares in the online stock market. The most popular options include The NASDAQ, The New York Stock Exchange and the Tokyo Stock Exchange. The shares you buy will fluctuate each day depending on how the stock exchange is doing. 

There is no guarantee of a return so you need to be prepared for the eventuality that you might lose the money you invest in. However it could also go the other way and you make a nice profit. If the price of the stock you invest in soars, then the stockholders can benefit from this. 

You would need an online stock broker to act as an intermediary between yourself and the stock market before you can invest funds. So it is important to research the ideal one for you beforehand. 

Employer Contribution To Retirement Funds

Check that your employer has signed you up for the 401(k) plan. This will ensure that each month your employer is contributing towards your retirement plan by making payments into your allocated plan. They automatically deduct any tax contributions through your paycheck and then allocate your percentage to the retirement funds. 

The 401(k) plan enables your employer to put aside the tax free income, which will then grow until you reach retirement age and want to withdraw the money. The average 401(k) plan can see a return of between 5% to 8%, which is based on 60% equities and 40% cash.

Keep On Track of Any Debts

It is important to keep track of any credit card repayments, or loans you have taken out, and stick to a stringent plan to pay it back as soon as possible. The longer you leave this, the higher the interest that will accrue which will mean you having to spend even more money to pay the debt off. This money could instead go towards your long term savings. 

Family Finances In Place 

It might not be an easy subject to bring up with your family, but ensuring that your parents or older relatives in the family have written a last will and testament is a good way to avoid family disagreements later on. This would establish legally how assets are going to be divided up regarding property, money and possessions amongst relatives. In some instances knowing that you will eventually receive a substantial payment could help you if you are currently unable to put together a down payment on a property. 

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