Need More Money? Four Moves to Consider


By- Rick Romano


Regardless of whatever else may await you in life, saving for the future could be one of your biggest financial challenges.

That’s why it’s important to take steps now to make sure you’ll have enough money on hand for retirement, family goals

or unanticipated financial emergencies.

A common question Financial Advisors hear from clients is, “How can I save more than I’m saving now?”

Fortunately, there are several ways you can accomplish that goal with a bit of professional help.

Consider the following:

Monitor expenses. Lowering your expenses by a modest amount such as 1% could allow you to boost your savings

initiatives as much as a comparable increase in pay.

To gain insights into your current spending habits, consider downloading a budgeting app for your smart phone. They’re

much easier to use than they used to be and make expense tracking very simple. For example, many apps allow you to

record your income and spending on the go, incorporating information from various accounts, in order to have an up-to-

the-minute overview of your financial standing each day. You can then look for inefficiencies– and ways to economize.

Reduce credit card expenses. On average, each US household with credit card debt owes a balance of more than

$15,000. 1 You can eliminate such debt faster–and start saving more–by paying more than the minimum monthly amount

on your credit cards each month.

For example, assume you have a $1,000 credit card debt with a 12% interest rate. By paying $20 each month, it would

take 67 months to eliminate the debt and would cost you $353.43 in interest. But by doubling your monthly payment to

$40, you would be out of debt in just 27 months. Your interest costs would be less than half– $103.28. Then, when you

finish paying off your balance, redirect the money you’d been spending on debt each month to a savings or investment


Another way to tackle debt expenses aggressively is by consolidating credit card balances to a single, lower-rate card.

Comparison shop for the best rates, but beware of “teaser” rates that start low then jump higher after an initial

introductory period ends.

Boost contributions. If you participate in a workplace retirement plan, consider increasing your contribution by an

additional 1% or 2% of income. Even if you think that may be too much, try it out for a few months. The extra effort

could make a big difference down the road: Contributing even $20 extra each week could provide you with an additional

$87,493 after 30 years (before taxes), assuming 6% annual investment returns. 2

Use windfalls wisely. While it may be tempting to spend a windfall– such as an inheritance or workplace bonus– on

something fun, it’s probably a better idea to use the money to enhance your long-term financial standing. For example,

assuming you invest a $2,000 windfall in an account earning a 6% annual rate of return, it could grow to $2,698 after 5

years, $6,620 after 20 years or $12,045 after 30 years (before taxes). 2

At Morgan Stanley, we can help you implement effective strategies for reducing expenses and set up customized savings

and investment plans to help pursue your goals. Call me so we can talk about the best way to get started.


1 Source: NerdWallet Finance, July 2015.

2 These examples are hypothetical and for illustrative purposes only. Your results will vary. Indicated returns cannot be

guaranteed. They do not reflect the performance of any actual investment and do not allow for the fees and expenses

incurred with investing. Calculations use monthly compounding at an annual rate of 6%, however actual investment

returns may vary from year to year, which could impact projected values.

If you’d like to learn more, please contact Rick Romano.

Article by Wealth Management Systems, Inc. and provided courtesy of Morgan Stanley Financial Advisor.

The author(s) are not employees of Morgan Stanley Smith Barney LLC ("Morgan Stanley"). The opinions expressed by the authors are solely their own and do not

necessarily reflect those of Morgan Stanley. The information and data in the article or publication has been obtained from sources outside of Morgan Stanley and

Morgan Stanley makes no representations or guarantees as to the accuracy or completeness of information or data from sources outside of Morgan Stanley.

Neither the information provided nor any opinion expressed constitutes a solicitation by Morgan Stanley with respect to the purchase or sale of any security,

investment, strategy or product that may be mentioned.

Morgan Stanley Financial Advisor(s) engaged The World Trade Council to feature this article.

Rick Romano may only transact business in states where he is registered or excluded or exempted from registration Transacting business, follow-up and individualized responses involving either effecting or attempting to effect

transactions in securities or the rendering of personalized investment advice for compensation, will not be made to persons in states where Rick Romano is not

registered or excluded or exempt from registration.

©2015 Morgan Stanley Smith Barney LLC. Member SIPC

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