Problems aren’t for anyone special in this world. We all experience them, and there are major life events that will change your life. An accountant can help you navigate the financial side of these problems. Having even a little of the stress lifted from these events helps more than you can imagine. The major life events listed in this article is; transitioning to adulthood, college, debt, starting a job, moving, marriage, parenthood, divorce, disability, and death. If there are any events you’d like us to analyze, please leave us a comment.
Transition to adulthood
Becoming an adult is stressful enough, there’s more responsibility, no one to tell us what to do, and we have the rest of our lives. An accountant can help you build out a plan for where you want to go because where you want to go is going to make money.
The questions most of us don’t ask are the most important ones. Before you dive into the job force, you need to answer these; How will you earn money? How will you spend your money? How will you grow your wealth?
I don’t think we give this much thought, most of us jump straight into a job. However, what about starting a business yourself? Most people that changed the world knew very little, but by building better money habits, they excelled. You can earn your money in multiple ways, that is the key because how you make your money will determine the sum that you receive in your lifetime.
How you spend your money is as essential. What you spend, you no longer have. The key here is not to spend more than you earn; otherwise, you’ll end up in debt. Decide how your money will support you, and question any decision that doesn’t align with your goals. Every decision is an emotional decision. Accountants can help you determine better spending habits that allow you to live, not restrict your lifestyle.
The transition to adulthood can be tiresome but so can be working your whole life with nothing to show for it. Money may not grow on trees, but you have more opportunities than your savings account to grow your wealth. An accountant can help you determine what will work best for you.
A big part of transitioning to adulthood is purchasing your car. A friend of mine bought a beautiful new sports car and based on the math he was doing, and he could afford it. The interest rate was high, and because he didn’t analyze his finances, he made a wrong decision. His first car, he couldn’t afford, and when you don’t make payments on a vehicle, it gets repoed.
College and accounting
College is a costly choice but can pay off with the right plan. You do not need to take on debt to go to college. Most colleges offer grants and scholarships that can help pay for school. However, picking up credit during college is one of the most common choices we make.
During college, you should build a financial plan. Your investment into your skills is growing, and it’s time to put on paper the potential you can make — the beginning of your financial independence plan. An accountant can provide you with a skeleton and walk you through the process of achieving financial freedom.h
Be wary of credit. We live in a society that offers you credit at every turn, but it’s something you have to pay back eventually. Avoiding credit cards during this time of your life can be crucial. Once you have a handle on your emotional spending, you can spend constructively. However, tackling loans, credit card debt, and car loans can become overwhelming.
When you’re young also isn’t the time to start building your credit score. It’s time to start saving. If you save $1,200 a year from age 20 to 30, at 8% growth, you’ll earn an additional $7,000. Just as interest. Because investing is best with time and since your young, you have all the time in the world. We can teach you how to invest.
Living a debt free life
Living a debt-free life is a possibility for all of us. However, usually, it’s not something we start thinking. By the time you turn eighteen, credit card companies will send you offers, each with a line of credit for you. I know it’s enticing, but it’s so easy to obtain a loan that you don’t need an income to start your journey into debt.
Living a debt-free life is more than making money; it’s how you spend your money, and what you do to grow it. You can use debt to build wealth but don’t let liability use you.
Make a choice early that you want to live a debt-free life. If you need help getting out of debt, an accountant can help you with better money habits, to make a permanent change. Debt relief programs and bankruptcy are not the answer. Click here if you would like to learn more about building a budget.
Things to think about when you start a job
Starting a job is an exciting experience. Here are some things to consider when you start a career. Accountants, most of them, dress professionally. They wear more than casual clothes and organized. Plus, they work in the business world.
Once you start making money, what are you planning on doing with it?
Let’s pretend you weren’t starting a job and instead you just won the lottery. You pick up your winnings, and you’re excited you spend $200,000 on a new car. You didn’t plan on it, but it happened because you had the money. If you don’t create a plan for your money, it will always control you in life.
Consider for a second that your job is a stepping stone to something better. The most wealthy among us build multiple incomes, and they continue doing it. How can you create numerous incomes to create the financial life you want.
If you’re starting a job or looking for a new job, there are a few things you can learn from accountants. When we search for a job, we often ask the ones around us for advice, our family or friends. Why not reach out to someone successful in the field you’re surveying? It can only help you.
Moving to a new home
Moving is something everyone does a few times throughout their lives. In my experience, moving is usually an unorganized mess. However, if you implement a system, you can create order from the chaos. Accountants are experts in building policies because most businesses can’t use the same methods, they have different problems. If you have too many people in your organization focused on a different key metric, it can confuse.
Consider the pre-planning phase. Are you moving to another city? Will your cost of living increase or decrease based on the move? These are important because it will help us adapt to a new environment. You might find that the area you’re moving to is less expensive. You can decide now if you’re spending money to hire a moving company or driving. Even though most of us submitted a security deposit, very rarely do we get it back. Consider the cost of hiring a professional cleaner and if it will guarantee you receive your deposit. If it will, then bite the price, your landlord may thank you for it.
An accountant can focus the organization into the metrics that matter. It’s not wrong to measure your performance, but it can be bad practice to measure the wrong things. However, with a slight shift and the right system, a move is smooth. Accountants can help your clarity on the correct measurements to focus on, so you can grow your team. If you’re moving to a new home, try hiring an accountant.
I remember when I got married, a million questions ran through my head. Where would we celebrate Thanksgiving? Who would host Christmas? Which family would we spend time with on the Fourth of July? Whom are we getting presents? Should we get a joint bank account? However, my focus was on the wrong things. My focus should have been on how we decide to handle our money together. Communication, but talking about money is uncomfortable.
A third party might be what you need to help navigate the difficult conversations.
A marriage license can cost you around $100 depending on the state. However, a wedding can cost a fortune if you don’t plan for it financially.
Speaking with an accountant about your different spending habits allows you to approach them calmly and with finesse. Talking about our money makes us uncomfortable and defensive. Sometimes a third party is the best option to help navigate the difficult subject. Accountants are experts in psychology and spending, so why not ask an expert?
One plus one equals one, when does that make sense? In parenthood it does, and parenthood is a journey. You’re preparing to shift the expenses in the household from two to three people, without a change in income. It’s essential to identify what financial education you both have and determine the type of economic life you want now.
Building it as a thought allows you to write it as a goal, and everyone wants financial independence. The problem is that we don’t think about it when we’re on top of the world, we think about it when we’re struggling. Building a real-life in a negative environment is not easy.
It’s important to decide now because your decisions are passed on to your children. Kids learn best through observation, everything I’ve ever know I have learned through observation. Even today, as an adult, I tell myself to go to bed early. However, my friends stay up, and I usually stay up with them, I have to observe and remove myself if I want to sleep early. Otherwise, I’ll do what everyone else does.
Everyone has their own financial goals, so doing what everyone else does is an evil plan. If you’re interested in teaching your children about money, you can get started today.
Filing fees for a divorce can cost much more. The lowest in the United States is $70 in Wyoming, and the highest is in California at $435. If assets are involved, then the process is usually guided by a lawyer.
Financially planning for this transition is beneficial. Divorce is stressful, you’re losing a partner, sometimes a home, and whatever additional income provided for that life. Adapting to a different lifestyle can be hard but not if you manage your finances properly. You might have an idea of what the change will impact, but let’s get it on paper, and we can strategize how we are going to attack it.
Disability is an immediate impact on income. Most of us can work at our full capacity until around age 50. If someone at the age of 24 is on disability, the person becomes limited to income potential. If their insurance is enough to cover their income, they now have medical bills, retirement contributions, and daily expenses to cover.
Building a financial blueprint is an essential part of financial independence. A financial architect can help you navigate and develop your blueprint. So disability doesn’t control your life, and you live a life you desire.
If your family has a financial advisor, they should be the person you speak. If they need assistance, you can reach out to us. It’s important because, after the death of a loved one, the will dictates where possessions go.
If you need help with preparing your will, please don’t hesitate to reach out. Every one of us should have a will made. The headache of not having a will isn’t something you want to put your family through.
Jimi Hendrix didn’t have a written will, and when he died in 1970, panic set in surrounding his estate. Over the next 30 years, a battle waged over who would get what. Often, musicians and artists will have the record label fight for profits. The musicians continue making money off the music they made, long after their death.
It’s more about being clear on where your possessions go than dealing with your death. If you don’t decide, then you risk leaving it up to the government to split your belongings as they see fit.
Stleg Larsson is a Swedish author who wrote The Girl with the Dragon Tattoo, but in 2004 he died. Swedish law states that his estate is divided up between his father and his brother. His life partner of 32 years, received nothing.
Life events are going to happen, but if you plan for the financial impact, you can lessen the stress you’ll experience. Having a dedicated personal accountant makes more sense as you build your income. Because life happens to everyone, the more you plan for events, the better you’re able to handle them. Not everyone is an expert in everything but everyone is an expert in something.
If it’s essential to you, and you can’t care for it, you’ll outsource someone who can.