april-financial

 

Did you know that April is Financial Literacy Month?  Well, it is.  In effort to promote financial literacy, several companies are lending a helping hand by offering free information and tools to the public.

 

T.D. Ameritrade, for instance, is offering free access to educational tools, research topics, and webinars via their online education center.  To help investors better grasp the idea and need to reorganize how they save and invest money, the brokerage firm introduced a four-step idealogy called F.A.M.E.  These steps are as follows:

 

Step 1 – Framing – The lenses with which you view your goals can have a profound effect on how you save for retirement.  If you focus on being behind on your savings goals it’s easy to feel defeated.  Instead of thinking “I have a 30% chance of not reaching my savings goals,” think, “I have a 70% chance of reaching my goals.”  It’s the same mathematically, but it’s all in how you look at it.

 

Step 2 – Action – Take action. Don’t get paralyzed or overwhelmed by the end goal of whay you must do. And, instead of focusing on what you can’t control – budget cuts, the fiscal cliff, social security – focus on the positives and what you can do. Remember that the first step is often the hardest. Don’t think “I will never be able to accumulate $2 million dollars by the time I retire.”  Say ” I CAN commit to setting aside $100 a month.” Every dollar towards your future will be money you will have in retirement.

 

Step 3 – Motivate yourself and set realistic goals. Create small, measurable goals and focus on what is within your control. You may only be able to set aside $50 a month. Start there and increase the amount when you are able. At the end of the year, you’ll be $600 closer to your goal. Once you reach your milestones make sure you reward yourself along the way.

 

Step 4 – Emotion – Understand the way your mind absorbs facts and makes decisions. Are you more of an intuitive decision maker who makes decisions with great ease and goes with their “gut”? Or are you a more reflective and analytical decision maker? When it comes to saving, both ways work, but it’s important to know how you make those calls so that if there are market fluctuations you are making decisions based on fact, not emotion.

 

 

The F.A.M.E. steps and more free education can be found at www.tdameritrade.com/education.page.