Hi everybody. You know, last time I talked to you, right around now, the stock market? Well, it was in the tank. The economy was just starting to come back, and then all of a sudden - what happened? The stock market started to go up 65%, everything started to seem like it was OK.
But here is what I want you to understand.
We are now standing on land that in my opinion has financial faults going all the way through it. And if we have any financial tremors whatsoever, we will find ourselves, in my opinion, right back to where we were in 2008.
So you have got to make sure that you are not dependent on anybody else's financial plan for you.
The economy cannot save you. The administration cannot save you. You have got to save yourself.
And you have got to make sure that your financial foundations don't have any cracks in them whatsoever.
So, what do you need to know to make sure you are standing on solid ground?
Well, the first thing you need to understand is that most of you probably have debt on credit cards. Many of those credit cards are charging you 30% interest, charging fees, doing all these kinds of things, especially if they are with major banks.
What I want all of you to do is go to creditcardconnection.org and find a good credit union near you. Anybody can join a credit union, where you get a credit union credit card.
Do you know by law federally-charted credit unions cannot charge you more than 18% interest rate? Get yourself a credit card at a credit card union.
Next, a lot of you have 401(k) plans where you work.
Now listen to me. You should be investing in your 401(k) plan, but only up to the point where your employer matches your contribution. After the point of your employer's match (or if your employer does not match), if you qualify for it, every single one of you should have a Roth IRA. A Roth IRA is simply a retirement account where you invest in it with money you have already paid taxes on.
You want to do that because currently we are in the lowest income tax brackets of our lifetime. Later on you may be in the highest tax brackets of our lifetime to meet with the deficits that we have. So why not invest right now, pay the taxes, so that you can take out the money later, tax-free?
If you don't qualify for the Roth, get a traditional IRA, make it non-deductible, and then convert to a Roth.
Do those things and you will be on happy financial footing.
Now, you stay safe.