What does a financial advisor tell RNs to do with their money?
What does a financial advisor tell RN to do with their money?
A financial advisor gives some few advice to registered nurses to put their money to work as hard than they do. They need to see a clear picture of their current financial health as well as their physical well.
This means knowing how much you earn on a regular basis, how much you spend, and how much you save, how much you invest, and how much you pay down debt. Your first priority is to invest those earnings on a regular basis. You don’t want to put debt or spending or saving before investing.
You need to invest before doing anything else. After you have a budget to invest regularly, then you can start saving, paying down debt, and spending. The reason I put spending last because these are extra money you have left from saving and paying down debt. For example, you earn biweekly $2,500. You need to put at least $500 of $2,500 into an investment account. This does not count the matching you have with your employer.
Therefore, the total money you need to put away is $1,000 a month of your $5,000 that you earn a month or $2,500 every two weeks. Some nurses earn more than $5,000 after tax. So, you can calculate it out to get the 20% into your investment account. This 20% must put into the Roth IRA or elective retirement account.
If you choose to do the Roth IRA the money put in this account is after tax; meaning you already pay tax already. If you choose to invest your money in elective account 457 or traditional IRA then these money is pre-tax, meaning you have not pay tax yet.
I think some of these information you might already know and may considered repetitive information; but I just want to mention them for those who have not yet start to do the 20% investing.
It is crucial for us to have a plan in place as a nurse because we use basically our physical, mental and emotional well-being to do the work. We need to prepare our financial health for the future success.
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