Four Tips to Protect From Financial Disappointment

4 Tips for Safeguarding Against Financial Disappointment


Written by John Rothans

Mar 25, 2020

Times are uncertain. Markets are in a state of flux. It might feel like the right financial move is difficult to see. If you’ve made some money moves that feel more like regrets, read on. We’re here to empower you with some tips for turning financial trials into triumphs and helping you better avoid financial disappointment in the future.

Common Financial Mistakes

“Financial mistakes are part of everyday life,” Senior Finance Advisor notes. The most common mistakes include living paycheck to paycheck, indulging in unnecessary spending, taking on too much credit card debt, and forgoing portfolio diversification, among others.

With stocks suffering and uncertainty reigning as the new norm, now is the time to position yourself for financial security

“Any significant market volatility presents a good opportunity for you to take an honest look at your reaction” and financial activity, advises Arielle O’Shea, a specialist at the personal finance website NerdWallet.com. Here’s how to better position yourself.

Conquering Financial Disappointment

1. Shift to Save More.

According to a survey by GOBankingRates, 58% of Americans have less than $1,000 in savings, and the percentage hasn’t changed much over the years.

“As the market flashes red, you should reevaluate how your savings are allocated,” experts say.

You don’t have to stop enjoying the things you purchase or curb shopping altogether. All you have to do is reduce spending on unnecessary items. Even small changes in behavior, like making your coffee and meals at home, can help.

To help increase your savings and organize your money, consider the following guidelines from Fidelity:

  • Allocate 50% of take-home pay to essentials, like housing and transportation.
  • Place 15% of pre-tax income into retirement savings.
  • Allocate 5% of take-home pay to a savings account for the unexpected.
  • Save the remaining amount for other personal goals.

Making specific decisions about how your money is saved and spent can help you gain a sense of financial control and avoid living paycheck to paycheck.

2. Make Informed Purchases.

Sometimes you can’t help but spend money. The dishwasher breaks, or you need to put new tires on the family car. That’s okay. It’s what your “savings account for the unexpected” is designed to cover.

Research shows, however, that the average adult in the U.S. spends $1,497 a month on nonessential items, which adds up to almost $18,000 a year.

To help avoid unnecessary spending, take the time to make informed purchases. Set priorities, make a budget, and stick to your plan. When it’s time to spend, do your research.

At U.S. Money Reserve, we encourage our clients to learn as much as they can about precious metals before they make a precious metals purchase. Financial decisions deserve time and consideration. Call or go online to read reviews, news articles, e-books, and more when it’s time to make a significant purchase.

“There’s always a need to do some research before deciding what to do with your money,” notes WiserAdvisor.com.

Plus, slowing the decision-making process can help you avoid spending impulsively on unnecessary items.

3. Guard Against Credit Card Debt.

A financial disappointment in one area of life could force you to reach for a credit card for some relief. Avoid the urge.

On average, each American household with a credit card carries $8,398 in credit card debt. It’s a tough beast to tackle. There are interest rates to consider, minimum payment amounts, monthly statements, and always another desirable purchase looming in the distance.

If you’re able to allocate your finances as Fidelity recommends and also make more-informed purchases, you’re well-positioned to pay down credit card debt.

4. Diversify Your Portfolio.

Recovering from financial mistakes doesn’t end when you fix a few problems. You must continuously pursue financial preparedness. Portfolio diversification is an essential part of that pursuit.

Diversification is the act of achieving variety in your portfolio to reduce risk. It’s like eating a balanced diet that includes all food groups. While healthy meals of fruits, vegetables, meat, and grains are no guarantee that you’ll stay in perfect health, they’re a solid defense. The same can be said for diversification.

Yet “1 in 4 Americans say they don’t know or have no opinion on whether their [holdings] are diversified,” found a survey conducted by CNBC Make It and Morning Consult.

With the recent economic turmoil, now might be the best time to adjust your portfolio. How does your allocation of traditional assets (like stocks and bonds) compare to your mix of alternative assets (like real estate and precious metals)?

Some experts recommend holding 10 to 25 percent of your portfolio in tangible assets like gold, silver, and platinum. Of course, your allocation will depend on the amount of protection your portfolio requires.

But Why Buy Gold and Precious Metals?

Owning gold and precious metals can do more than help protect against another financial disappointment in life. It can help give you and your family a sense of tangible security. Call U.S. Money Reserve at 1-844-307-1589 to learn more about the powerful benefits of precious metals.


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