The Four Best Financial Moves You'll Ever Make

The life of the average middle class citizen hasn't gotten any easier in the last few years. Rising external costs and stagnant wages have forced cost cutting in many different areas of the typical family budget. As a financial professional, I see many people struggling to get by with their current financial situation. Everyone wants to be financially comfortable, but reaching that point is not easy. A common complaint I hear from individuals is that they simply cannot take every step that their financial planner advises them to take, because they don't have the required funds. Which moves should be made first? The single biggest key to a successful financial future is setting the right financial priorities. Let's take a look at the four best financial moves you'll ever make.

Four Best Financial Moves You'll Ever Make

Pay Off All Debt First- This one makes a ton of sense, but there are quite a few people who simply don't heed this critical advice. Before you start making other purchases or investing in anything, you should always pay off all your debt first. The interest that builds up may seem small at the time, but it does a significant amount of damage over the long haul. Also, be smart about which debts you pay off first. Start paying toward the balance of the debt with the highest interest rate.

Create a Rainy Day Fund- Planning your financial future is one of the best moves you'll ever make, but you must remember that there are always going to be costs that come completely unexpected. Whether you have a family or you are just on your own, creating an emergency fund that would allow you to get through three to six months worth of living expenses is an extremely wise idea.

Contribute to a 401k or IRA- Many individuals don't realize the tax advantages that come with an IRA or a 401k account. These retirement accounts are a terrific way to save up for your future and do so with tax benefits from the government. You can't afford to not take advantage of these retirement savings accounts. The sooner you open an account like this the more you will be able to take advantage of compounding returns.

Live on a Reduced Budget to Cut Costs- One of the best ways to save money over the long run is to live on a reduced budget. What exactly do I mean by this? If your family is bringing in $70,000 annually after taxes, I strongly suggest living on a budget as if you are bringing in just $55,000. By doing this you will make yourself pinch pennies in every possible way, and you'll hold yourself accountable for all financial decisions. Reduced budget living develops great financial spending habits that will stick with you for your entire life.

If you make these four financial moves, I am confident you are on the right track financially. No one said it would be easy, but some simply setting of priorities can get you on the path to financial freedom!

More From This Contributor

Three Reasons to Maximize Your 401k Match

Top Five Mutual Fund Families

Top Five Ways to Increase Your Investment Returns