by M Taylor

Imagine this scenario – you have received a windfall of $25,000, and you know you should invest for the future. Before you sign up and sign away that money, ask yourself this question – if you’re living paycheck to paycheck with high interest credit card companies hounding you via letter, telephone and via ninja agents pounding on your door, is it a good time to start investing? The answer is obvious, “Of course not!”

However, that’s exactly what some people will do mistakenly thinking that a 3-5% interest rate from investments is enormous while their credit cards bill them 9-18% plus finance and late charges.

First, get your latest credit report. You should, in reality, do this once a year. It’s very important to read your credit report, find out what’s on it, and clean up any negative items on the report as quickly as possible.

However, if you are in $25,000 worth of debt, it may serve you better to clean up your problems using that $25,000 instead of investing and maintaining that debt.

Many people make a priority mistake when they decide to invest. In order to avoid that, see which are paying out on a monthly basis, look at all the dispersal’s and get rid of the expenses that are frivolous.

Let’s take an example of one thing you might be able to get rid. If you have credit cards with all that high interest, pay them off and get rid of them. Pay off all those high interest loans along with those credit cards as quickly as you can, then refinance any high interest loans that are left, and replace them with loans that are billed at a lower interest rate. In the long run it will make better sense to pay down debt, and you will see over time that this is the wisest course of action.

Once your financial status is good then enhance your monies with sound investments for the future. It now makes little sense to invest your money. When your bank balance is bad or problematic, or if you’re living from paycheck to paycheck and paying bills is a struggle, that is not the time to think about tying up your cash. Investing your dollars in rectifying your adverse financial issues first would make better sense.

Here’s a secret: Investing doesn’t make sense if your bank balance is shaky to disastrous, if your monthly bills are a constant struggle and you feel like you can’t breathe out without hearing from a collection agency. Investing your dollars in rectifying your adverse financial issues first makes better sense and you’ll sleep better at night. Progressing towards financial solvency will also give you time to educate yourself on the different types of investments available. In this way, when you found yourself financially sound once again, you will be prepared to make good investments for your future.

About the Author:
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