Maybe it should be five things, because the suggestions often start with: Keep it Simple.
But four things cut across the lists of suggestions offered by most money managers and personal finance writers, according to a recent New York Times article (found here).
- Build an emergency fund. Six months is typically recommended, but at least start by building a one-month reserve.
- Invest in index funds. If you don’t know what these are, see an explanation here.
- Buy a home—an affordable one. This means buying less than you can afford, or than the banks want to lend you.
- Buy term life insurance. This is the epitome of “keep it simple.” Avoid the complex alternatives offered by insurance agents.
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