Facts do not cease to exist because they are ignored.
Once you've paid down that debt and are spending less than you make - the next step is to start building your net worth.
The first thing you'll need to do is start tracking your wealth.
Tracking will allow you to calculate your net worth, find and remove needless investment fees, properly diversify and plan for retirement.
It's all a lot of work - that's why I automate it.
I use a free online portfolio manager called Personal Capital to calculate everything for me.
You might have heard this quote from Peter Drucker, "If you can't measure it, you can't manage it." Peter was a famous management executive and pioneered how people are organized across corporate and government organizations.
A cornerstone of his philosophy was the importance of data and using it to drive decision making.
How can you make a decision if you don't have any information which to base it on? I've found that the detailed metrics available to me in my account help me to make very educated decisions.
Smart decisions. Decisions that make more money.
Investing is no different.
Your future self will thank you.
I'll be honest, it's a pain to plan for retirement.
Calculating how much you need, stressing over a bunch of unknowns and generally just spending too much time with your head in the future.
I'm not sure if there is any science to back this up but I'm pretty sure it's unhealthy to think about things 30 years from now.
I'm too busy trying to navigate the next 3 years.
Personal Capital has the most sophisticated, realistic retirement planning calculator available and is completely free when you join (as are the entire suite of their financial tools).
Their tool runs a bunch of Monti Carlo simulations to determine what's most likely to happen to your investments over the next 30+ years so you don't have to.
Here's a sneak peak of one of their sexy graphs.
Getting Started With Personal Capital
To start using Personal Capital yourself, here's what you need to do:
1. Sign up for a free account here.
2. Check out this article for instructions on how to obliterate your 401k fees and this article for an overview of the entire tool.
3. Use your monthly numbers from Personal Capital to track your progress towards financial independence.
I hope you get as much use out of Personal Capital as I have. It's really powerful so I know you're going to love it!
You're about to be impressed
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