According to CelebrityNetWorth.com, former NFL wide receiver Terrell Owens played 15 seasons, earning an estimated $80 million dollars from salary and endorsements. But she lost a lot, she told GQ, and she recently shared Together NerdWallet said that after being drafted and seeing the over-the-top lifestyles of other professional athletes, he “wanted to be like everyone else, with Mercedes and all the flashy cars and jewelry.”
Owens said: “I think they are some of the most stupid purchases I think players can make, especially when they don’t have the money in the bank account to actually pay for that stuff.”
And he added: “My advice to any fan or athlete: Just don’t live beyond your means.” It’s simple advice that can help you save money, especially now, when many savings accounts are paying as much as they’ve been in a decade (think well above 4%).
Pros say that living beyond our means is common for many of us, and it can be very costly. “What you think is a lot of money may not actually be a lot of money. It takes a lot more money than you might think to generate enough income to maintain your and your family’s standard of living. If If you are 40 years old and have $1 million dollars and then you stop working, you can only spend $30,000 a year without risking running out of money,” Certified Financial Planner in Your Best Path Financial Planning Gordon Auterman says
How to make sure you live within your means
Learning to live within your means is an important way to achieve financial stability, says Anthony Ferreira, a certified financial planner at Worthpoint Wealth Management. “The best thing is that it scales, the more you make, the more you can afford, just learn not to spend more than you earn,” says Ferreira. Here’s how to live within yourself so you can save more and achieve financial security.
1. Calculate Your Net Worth
Sometimes people think they have a lot of money because their income is high, but calculating your net worth can help you really understand what you have — and how much you can save to pay off debt and meet emergencies. Where you may fall short is saving for retirement and other goals.
“Add up the value of everything you own that you can sell, including stocks, bonds, funds, bank accounts, savings bonds and your home. These are your assets. Then, take out mortgages, credit card debt, student loans and any Add up the amount you owe on other loans. These are your liabilities. Your net worth equals your assets minus your liabilities,” says Achterman.
2. Identify Money Goals
Achterman says it’s important to have a savings goal. “Most people should aim to save 15% to 20% of their gross income every month. The more you save, the sooner working becomes optional. If you have a workplace retirement plan like a 401(k), put in as much as you can each month,” says Achterman.
In 2023, the maximum amount someone can put into their 401(k) is $22,500 — plus an additional $7,500 if you’re 50 or older. But before contributing the maximum amount to your retirement or any other savings fund, consider paying off any debt you have, especially if it comes with high interest rates.
3. Track Your Spending
Keep track of every dollar you spend over 2 to 3 months. “Every dollar on your tracking list should be put into a category like groceries, rent or mortgage, utilities, eating out, entertainment, insurance and loan payments. Try to make the category of everything as small as possible and focus on Let what amount is surprisingly high for you – that is where you need to cut back on spending,” says Achterman.
4. Have separate bank accounts
“One strategy I use with my clients is to keep the money out of their daily checking account and keep it in either an investment account or an alternate savings account,” says Andrew Feldman, certified financial planner at AJ Feldman Financial. , When people see that their balance is high, people spend more.
5. Avoid impulse buying
Avoiding impulse buying and staying in the black go hand in hand. In terms of managing everyday spending, especially on credit cards, you must plan ahead and be thoughtful, says LendingTree principal credit analyst Matt Schultz. “You can’t avoid every expense, but the ones that ruin your budget are splurges and impulse purchases. They’re all right from time to time and in moderation, but done too often and in too big a way, they can be disastrous.” Could be,” says Schulz.
If you have a bank account full of cash, Owens says it can be easy to make frequent mindless purchases. “Sometimes at the time you think the purchase was very well calculated … but in the long run you’re like ‘Ah, I don’t think I should have bought that,'” says Owens.
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