You are the CEO of your own money.
You are in charge. You make all the important decisions. When it comes to your wallet, you are the most senior executive and you are the one overseeing everything.
That’s good and bad. The bad part is that you bear all the responsibility and no one else is to blame. The good thing is you have the power to do things better for yourself.
It is time you accepted that power. It’s time to take decisive control of your finances. Here are six ways to act like a CEO:
1. Get a good return on your investment
A good CEO focuses on “ROI – Return on Investment.
You want to invest your time and money in things that will make a profit. This includes making apple-to-apple comparisons: Should I do THAT or should I do THAT?
For example, if you already have an emergency fund, instead of putting money in a savings account for a rainy day, you should really invest. This is the best way to make your money grow.
With interest rates this low, a savings account pays next to no interest these days. However, according to the US Securities & Exchange Commission, investing in the stock market has produced an average annual return of 7% adjusted for inflation.
Not sure where to start? Beginners like Robinhood because it has no commission fees and you can buy and sell stocks for free – with no limits. Plus, it’s super easy to use.
2. Stay in the black
A smart CEO is always looking for ways to cut unnecessary expenses and improve their bottom line.
For example, do you have credit on your credit cards? Then you are almost certainly spending too much money on interest. Credit cards charge notoriously high interest rates.
With the help of a free website called AmOne, you could have all of your credit card debt paid off by the end of the week.
You get a low-interest loan that allows you to pay off all of your credit cards at once. Interest rates start at 3.99% – much lower than the 20% or more you are likely to pay your credit card company. That could save you thousands in the long run, which is a solid CEO move.
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3. Pay yourself first
CEOs make sure they get paid. That is really not a question. No matter what, CEOs make sure they do Will. Paid.
Of course, you have to meet all of your obligations and pay all of your bills, etc. However, you also need to take care of yourself and your own financial needs.
Invest in your retirement. Build a nice, fat retirement fund through a 401 (k) or an IRA.
Also, make sure you have an emergency fund in place – a stash of easily accessible cash worth six months’ wages in case you unexpectedly lose your job.
With an Aspiration account, you can earn up to 16 times the average interest on your savings and up to 5% cashback on debit card purchases.
4. Have a mission statement
This is another way of saying, “Don’t forget your long-term goals.” When making a money decision, ask yourself, “Does this get me closer to my goal?”
You should take concrete steps towards your goal. That’s what a CEO would do.
For example, a long-term goal can be to own your own house. Or maybe you want to drive a better car.
In this case, you need a good credit score. That makes a big difference in the amount of interest you pay on a mortgage or a car loan. That can easily add up to tens of thousands of dollars over the life of a mortgage.
If you’re looking to get your creditworthiness back on track – or even if it’s on the right track and you want to improve it – try a free website called Credit Sesame. Within 90 seconds you will have access to your creditworthiness and personalized tips for improvement. You can even spot bugs that are holding you back (every fifth report has one).
Would you like to check for yourself? It’s free and only takes about 90 seconds to sign up.
5. Focus on the interests of the stakeholders
“Stakeholder” is a big buzzword in the corporate world. In the economic sense, stakeholders are people who have an interest in the company, such as investors, employees and regular customers.
In your private life, your stakeholders are your family members.
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You are probably thinking: I don’t have the time or money for that. But your application can take minutes – and you could leave your family up to $ 1 million with a company called Bestow.
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6. Innovation and pivot
CEOs love this stuff. This is a big step for the CEO. They always talk about innovating, moving with the times, and moving on to the next profitable thing that’s just around the corner.
You can also innovate in your personal financial life. Just try a money-saving move that you’ve never dealt with before. You will be surprised how much money you will save!
For example, you are likely to shop online more often than you used to. (Most of us are.) Wouldn’t it be nice if you got a notification when you overpay?
This is exactly what this free service does. Just add it to your browser for free, and before you check out, it will check other sites including Walmart, eBay, and others to see if your item is on sale for a cheaper price. You can also get coupon codes, set up price drop notifications, and even see the item’s price history.
For example, let’s say you buy a new TV and assume you’ve found the best price. Here you will get a pop-up letting you know whether this particular television is available for a cheaper price elsewhere. If coupon codes are available, these will also be automatically applied to your order.
Last year, this saved people $ 160 million.
You can get started with just a few clicks to see if you are overpaying online.
Remember: you are the CEO of your money. It is nobody’s responsibility but you.
Mike Brassfield ([email protected]) is a senior writer at The Penny Hoarder. He’s not a CEO, but he does believe in being strategic with your money.