The Secret to Financial Peace of Mind

The Secret to Financial Peace of Mind

The Secret to Financial Peace of Mind

Time goes by so fast. By mid-year you had planned to increase your savings, make progress towards paying off your debt, start saving for your retirement, your child’s university education or any other financial goal you had in mind, but you realize that you are in the same position you were in when the year started.

Getting started on managing your hard earned money may be harder than it sounds, yet we all agree that financial peace of mind starts with knowing where your money is channeled to, and knowing that you have made appropriate plans for your short and long term goals.

The path to financial peace of mind involves making smart plans for your hard earned money. It also requires getting started the following 5 financial good habits.

Getting started on spending on a budget

Budgeting your money enables you to keep a close watch on your money.  Without a budget, you may be inviting unnecessary debt and making it hard to save for the various financial goals you have. A budget may help you discover that your money can stretch further than you thought possible.

Financial freedom requires making smart plans for your hard earned money

Getting started on handling your debt

When you are in debt, you need to critically analyze every single item on which you want to spend your money on. With your expenses reduced, you will be able to clear your debt faster, and will avoid the trend of taking a loan to pay off an existing debt.

Once your debt is cleared, it is in good habit to continue to minimize your expenses and continue to live frugally in order to put aside that portion of your income into a savings plan.

Getting started on managing your investments

The key to managing your investment is knowing when to invest, where to invest , when to cut your losses and when to lock in your gains.

Most long term investments offered in the financial service industry require you to maintain your focus on your goal. Take your time to understand the investment tools offered to you by your financial advisor, and do your research on how you can benefit most out of that particular investment.

Getting started on planning for your retirement

If you’re expecting to live off the National Social Security Fund after retirement, you’re in for a disappointment. Your social security fund will not sufficiently cater for your living and health care expenses – which drive up retirement costs for most people.

As a general rule, financial experts recommend individuals accumulate enough to replace at least 70% of their pre-retirement income once they retire. Saving for retirement can put extra money back in your pocket. Putting money into a registered retirement benefits scheme can give you tax savings that amount to thousands of shillings; savings that you can then use to meet more of your financial goals.

Getting started on building your emergency fund

While the amount of your emergency fund will depend on your ability, most experts suggest having at least three months’ worth of living expenses set aside. Having an emergency fund creates a risk-free safety net for you and your family.

You may need to automate deposits in order to ensure that you build your emergency fund. It may take you months or even a few years to build up an adequate emergency savings fund. That’s okay. By starting a savings plan today, you move closer to having a robust emergency fund in the future

In a nut shell, the key to financial peace of mind is knowing how to manage that hard earned money you get so as to achieve financial peace of mind now, and in the long term.

What are your thoughts on getting started in achieving financial peace of mind?


10 Ways to Prepare for Retirement

bucketFinancial security in retirement doesn’t just happen. It takes planning and commitment and, yes, money.

Facts

  • Fewer than half of us have calculated how much we need to save for retirement.
  • 30 percent of private industry workers with access to a retirement plan do not participate
  • On average we spend 15 years in retirement

1. Start saving, keep saving, and stick to your goals

If you are already saving, whether for retirement or another goal, keep going! You know that saving is a rewarding habit. If you’re not saving, it’s time to get started. Start small if you have to and try to increase the amount you save each month. The sooner you start saving, the more time your money has to grow. Make saving for retirement a priority. Devise a plan, stick to it, and set goals. Remember, it’s never too early or too late to start saving.

2. Know your retirement needs

Retirement is expensive. You will need about 75 percent of your pre-retirement income lower earners, 90 percent or more – to maintain your standard of living when you stop working. Take charge of your financial future. The key to a secure retirement is to plan ahead.

3. Contribute to your employer’s retirement savings plan

appleIf your employer offers a retirement savings plan, sign up and contribute all you can. Your taxes will be lower, your company may kick in more, and automatic deductions make it easy. Over time, compound interest and tax deferrals make a big difference in the amount you will accumulate. Find out about your plan. For example, how much would you need to contribute to get the full employer contribution and how long would you need to stay in the plan to get that money.

4. Learn about your employer’s pension plan

If you’re not saving, it’s time to get started. Start small if you have to and try to increase the amount you save each month. The sooner you start saving, the more time your money has to grow.

If your employer has a traditional pension plan, check to see if you are covered by the plan and understand how it works. Ask for an individual benefit statement to see what your benefit is worth. Before you change jobs, find out what will happen to your pension benefit. Learn what benefits you may have from a previous employer.

5. Consider basic investment principles

How you save can be as important as how much you save. Inflation and the type of investments you make play important roles in how much you’ll have saved at retirement. Know how your savings or pension plan is invested. Learn about your plan’s investment options and ask questions. Your investment mix may change over time depending on a number of factors such as your age, goals, and financial circumstances. Financial security and knowledge go hand in hand.

Putting money away for retirement is a habit we can all live with. Remember…Saving Matters!

6. Don’t touch your retirement savings

If you withdraw your retirement savings now, you’ll lose principal and interest and you may lose tax benefits. If you change jobs, leave your savings invested in your current retirement plan, or roll them over to an individual pension plan or your new employer’s plan.

7. Ask your employer to start a plan

If your employer doesn’t offer a retirement plan, suggest that it starts one. There are a number of retirements saving plan options available. Your employer may be able to set up a simplified plan that can help both you and your em- ployer.

8. Put money into an Individual Retirement Account

You can put .Kshs. 3,000 or more a month into an Individual Pension Plan (IPP); you can contribute even more if you are 50 or older. You will enjoy various tax advantages.

When you open an IPP, you have two options – to contribute the amount before tax or contribute the amount after tax. The tax treatment of your contributions and withdrawals will depend on which option you select. IPP’s provide an easy way to save. You can set it up so that an amount is automatically deducted by check off or bank account and deposited in the IPP or send your contributions via Mpesa.

9. Budget on the back end

Create a budget you can stick to just before you retire. After years of creating new budgets as your net worth grew more and more positive, you should be a pro at making budgets by now. This is not to say that you have to look forward to living frugally for the rest of your life, just wisely. What is it you’ve always envisioned yourself doing when you retire? If it’s travel, then cre- ate a travel category as a monthly expense in your retirement budget. If it’s spending time with your family, then create a “spoil the grandkids” category.

10. Ask Questions

While these tips are meant to point you in the right direction, you’ll need more information. Ask questions and make sure you understand the answers. Get practical advice and act now.

Don’t Let Asthma Rule Your Life

Don’t Let Asthma Rule Your Life

Most of us know someone who has asthma. Some have been in a situation where someone had an asthma attack and you wish you could help but you stood next to them helpless as you saw them helping themselves or waiting for help to come. Asthma is a disease that has no cure but it definitely can be managed and once one knows how to manage it, their lives can be as normal as a person who has no asthma.

Read more to know more about asthma and how it can be managed.

ASTHMA

Asthma is a disease of the airways where the lining of the airways swell due to the muscles around the airway becoming tight and mucus increases in the airway. This disease affects nearly 300 million people in the world. In Kenya it is estimated that about 6 million Kenyans may have asthma in varying degrees of severity.

 CAUSES

The main cause of asthma in not fully understood. However asthma is known to run in families. The environment around us plays even a bigger role in asthma development with people leaving in urban areas being more prone to asthma.

 OCCURENCE

People who are prone to getting asthma are more sensitive to triggers in the environment than normal people. These triggers include:

  • Infections: This is the number one trigger of asthma in children. These infections are usually the upper respiratory tract infections like the common cold and the flu.
  • Allergies: Allergies are caused by chemicals in the environment called allergens. An allergy is an overreaction of the body’s immune system that leads to chemicals released in the body that cause allergy symptoms. These chemicals can also trigger an asthma attack. Common allergy causing chemicals (allergens) include dust mites, pollen from flowers, animal dander (saliva or hair), cockroach droppings, dust and food additives like food colouring or preservatives.
  • Irritants: These chemicals do not cause allergy but irritate the airway triggering an asthma attack. These irritants include cigarette smoke, smoke from firewood, diesel fumes, perfumes and paint fumes.
  • Sudden weather changes can also trigger asthma as the sudden weather change can release triggers like dust or pollen or even cold air.
  • Exercise can induce asthma. As one exercises, the amount of air going in and out of the lungs dries and cools the airways. This drying effect seems to trigger asthma in those prone to getting it.
  • Medications such as Aspirin and some types of pain killers could cause asthma.
  • Emotional extremes of joy or sadness can trigger asthma.

SYMPTOMS

You will know you have asthma if you:

  • Have a  family history of allergies/asthma and tend to get breathless,
  • Have a wheezing sound when breathing and/or coughing a lot especially at night

These symptoms are as a result of the buildup of mucus and the tightening of the airways. It is important to get screened.

TREATMENT

Here are instructions of how to properly use the inhaled medications in both adults and children:

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                                     source : Global Initiative for Asthma

how to use metered-dose inhaler

                                                                 Source:premier care paeds

 Asthma has no cure but it can be easily managed. The key to proper control of asthma is the prevention of asthma, identifying when an asthma attack is coming and the use of medication as prescribed by the Doctor.

The medications given have two functions. They relax the tightened airway muscles and reduce the mucus. The result is the reduction of the symptoms. The medications are usually inhaled to have a faster effect and avoid side effects with less of the medication reaching the blood. The inhaled medications can be taken for immediate relief and for long term prevention of attacks.

NB: When using a steroid inhaler remember to rinse out the mouth with water.

WHEN TO SEE A DOCTOR

An asthma attack can get progressively worse and the person is unable to get enough air into the lung. This is a dangerous situation. Watch out for these danger signs in a person having an asthmatic attack:

  • Not improving on the inhaled medication
  • Gasping  for air
  • Difficulty talking
  • Continuous coughing
  • Reducing  level consciousness or very restless

When you notice these attacks on a person, rush them to hospital immediately.

Please share your experience/comments and thoughts.