My wife and I live well below our means and pay extra every month towards our mortgage.
I recently read that this may not be the best financial decision since our mortgage rate is low( >4% ) and that I should look into investing that extra payment. Problem is, I have no idea how to do that. I already max my 401K and my wife doesn't have the option of one.
Can some kind person please offer advice?
tiescore
Favorite Answer
Get the Dummies Guides to Investing and the Dummies Guide to Personal Finance. That should at the minimum give you the language and knowledge, if not to do it yourself, to at least articulate to a financial advisors your financial goals and needs and be sure he is guiding you correctly.
I personally every paycheck allocate some to investments (long term financial goals), some to savings (short term financial goals), some to early debt retirement, and a last bit to whichever of the best seems best at the moment. Spreadsheet your finances, really think about your financial goals, I started building wealth like crazy once I focused in on my financial goals because all the extraneous spending I was doing just faded away, I was locked in on the big picture. Spreadsheet out your assets, your liabilities, calculate your net worth at the end of every month. Pick investments or savings vehicles to meet each financial goal as appropriate. For instance, after I refinanced my mortgage I started putting half the savings into a Betterment (robo-advisor) account. I don't care about the ups and downs of it, but some day there will be a lot more in there than remains on my mortgage, then I'll just liquidate it and pay off the mortgage. I have an online savings account with several sub accounts, each for a different savings goal. I have serious goals, and home improvement goals, and even fun stuff goals. It keeps me out of credit card debt and constantly focused on the next goal to achieve.
In addition to my goal based savings and investing (usually mutual funds/robo-advisor accounts for long term goals), and my retirement accounts (the personal finance guide will tell you about all the options you have here - just double check like annual contribution numbers online as they change from time to time) I use individual stocks as my general wealth building. That is a whole new level of learning, but if you are of a mind to learn there can be some tax advantages to doing so.
salena
Check this website
accurateTradingSystem dot c0m
?
Forbes magazine, Money magazine, etc.
Anonymous
Stocks have risk whereas paying extra on the mortgage is a no risk guaranteed return of the 4% you save.
Depending on your age, you can put more money in stocks. Easiest way is a low fee s&p 500 index fund. Invest every month for the long term and it SHOULD outperform the 4%. But there are no guarantees.
Maxi
A financial advisor