Financial Planning

Is Paying Off Debt Better Than Investing?

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As a former financial planner I know that not all finance is just about the math. The truth is that earning money, spending money, and saving money is a highly emotional thing. While it is fine to suggest that people eliminate emotion when dealing with money, that’s a little bit like telling people to eliminate hunger when dealing with dieting, it just won’t work in the long run. Is It Better to Save Money or Pay Off Debt? One of the things that gets thrown around like a solid, no-exceptions, rocket science idea from time to time is the concept of paying off debt as a high, guaranteed return. The theory goes a little something like this: If you pay off a credit card with an 18 percent interest rate, then that is like getting a guaranteed 18% return on your investment. Obviously, a sure thing 18 percent return is probably the best possible investment in the world from a risk/return perspective. But, is it really that simple? Mathematically, paying off higher interest debt is always the right move. However, that isn’t necessarily always the best move for real life, particularly if your finances are not in very good shape …

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Financial Planners and Financial Advisors an Introduction

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Listen to the book authors, newspaper and magazine columnists and many web sites, and you will hear that financial advisors or financial planners are nothing more than glorified snake oil salesmen out to separate you from your hard earned money. To listen to some in the finance industry and their champions, financial advisors and financial planners are bastions of righteousness steeped in knowledge about financial concepts so complex that no mere mortal could possibly hope to navigate the waters alone. The truth of course lies in between. In real life, many financial decisions are frighteningly complex and, unlike other decisions you may face in life, many of them are irreversible once a mistake has been made. More importantly, some of the biggest financial issues, like retirement, take years to accomplish, and you get one chance. If you try the latest fad diet for a couple of months only to find out it doesn’t work for you, you start over a little wiser and with a little more experience. You could try different diets hundreds of times in your life while figuring out what works for you. You could also talk to friends and family, each of whom has dozens of …

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Part 4 and Part 5 of Financial Advisor and Financial Planner Primer is up!

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Part 4 and Part 5 of the Primer about [tag]Financial Advisors[/tag] and [tag]Financial Planners[/tag] is now up. Find out about what certifications you need to understand, and why they matter. Don’t worry, it’s a way shorter list than you might think. Also, keep an eye out for TONS of new content once I get a chance to do final edits this weekend. Here is a sneak preview: Why You Need at Least TWO Credit Cards for a Good [tag]Credit Score[/tag] How to Choose A Financial Advisor- Finally the Details to All Those One Line Requirements You’ve Read Before Financial Advisor vs. Financial Planner – More Than Po-ta-to Po-tah-to The [tag]Stock Market[/tag] – It’s Is DUMBER Than You Think And More…