Big Life Decisions - Top Strategies

One of the most important things to remember when making some big life decisions is that life is not as short as we think. People often use this catch phrase when they want to do something unadvisedly like buying a luxurious thing they currently are not able to afford. In this article we’re going to list some of the big life decisions people need to make for which “life is short” phrase definitely shouldn’t be used. Choosing the Right Employer People think that it is easy to change the job and find another employer, but if you look at it from the point of retirement benefits, five or ten years of working for employer who doesn’t provide company match or retirement contribution can largely affect  retirement balance in the end of the person’s work career. It is not mandatory for a company to pay match for the employee’s 401(k) plan. On the other hand the most common employer’s contribution is “100% of the first 6%”. This means that the employer will add the same amount of money to the employee’s retirement balance as the employee him/herself if the annual sum is 6% of the gross salary or less. Employees who work for companies that provide these kinds of plans have two times bigger retirement balances, than the ones who work for companies that don’t offer employer’s match.   Of course there are companies that provide even bigger percentage for 401(k) plans, these are even more desirable employers, but are also really hard to find. Asking for Bigger Starting Salary Starting salary is the most controversial topic on a job interview, and lots of recruiters are trying to simply skip it. Bigger starting salary will jump start professionals earning potential in the future to come, so it might be a good idea to risk and try to negotiate the amount that will at least match the proficiency and experience that candidate has. Recent studies showed that candidates who tried to negotiate their salaries received a $5,000 of starting salary increase on average. This amount doesn’t sound much, but on the long run it can bring several hundred thousand dollars more to the candidates who were brave enough to stand tall on a job interview. Choosing the Right Mortgage Plan This is one of the most important decisions in person’s life and being hasty when it comes to this matter can lead to terrifying consequences that include loosing lots of funds. Mortgage should fit both person’s budget and lifestyle. For example, for people who don’t plan to move for several decades, fixed-rate mortgage might be a good idea. Another good way to repay home faster is by switching to bi-weekly payment plan. This way, debtors pay one additional monthly payment annually, which cuts the interests and creates more equity. Benefits of this kind of payment plans can be calculated with biweekly mortgage calculator that can easily be found online.  Adjustable rate mortgages have sense only if debtor is planning to live in the house for seven years or less, mostly because they come with less interest and lower monthly payments. Choosing Between Saving and Investing People who are lucky enough to have some bigger sums of money on the side are facing one of the biggest decisions out of all. It mainly depends on people’s plans, as well as on the terms and conditions offered by the banks. Current market situation is another parameter that should be taken into consideration. The best bet would be to spread funds and go with both saving and investing. When it comes to saving, bank savings account is not the only way to save money. Life insurance is another popular way to do that. Investing can mean anything from buying real estate to investing in stock market. Market investors with good portfolio usually decide to diversify their funds. Diversification makes positive performance of certain investments cover the negative ones of the others. This means that a wise investor should invest his/her funds in several different companies and industries, including investing in hedge funds, real estate and other possibly profitable businesses.