This article originally published by Liz Hund on Bankrate.com.
When it comes to financial advice, clichés are a dime a dozen. And while these clichés are on the money, they’re repeated so often that it’s easy to shut them out completely.
But then again, these clichés have stood the test of time for a reason and sometimes we need to be reminded of why rather than hearing the same phrase all the time.
So while we hate to beat a dead horse, here are four cliché pieces of financial advice that everyone should be following on a basic level.
1. Make a budget and stick to it
You’re probably sick of hearing it, but the budgeting app YNAB’s namesake isn’t wrong — You do need a budget. And you should try your best to stick to it.
In fact, it’s not surprising that 43 percent of Americans made “create a budget” a part of their 2020 New Years’ resolutions, according to a study by The National Endowment for Financial Education (NEFE). However, another study conducted by Mint, the money management app, found that 65 percent of Americans had no idea how much they spent in the previous month.
So while you may be sick of this cliché piece of advice, it doesn’t look like it’s going anywhere anytime soon.
2. You need to plan for retirement
It seems like as soon as you enter the workforce, the first thing everyone tells you to do is start planning for retirement and you’ve probably thought to yourself, “But I just got started working?”
Well, that’s good news for you. The sooner you get started, the more time you’ll have to build your savings. And if you haven’t already familiarized yourself with Roth IRAs or 401(k)s, it’s probably a good time to get started — especially if your employer offers a match.
For many of you, we know your retirement may not feel like an urgent priority. But think of it this way — the more time and thought you put towards saving for the future now, it’s likely to lead to greater financial security down the road.
3. Diversify your investments
We get it, it sounds complicated — but it really doesn’t have to be.
In fact, diversifying your portfolio could be a lot easier than you would expect. If you’re intimidated by investing, consider starting with an S&P 500 index fund, which is a collection of 500 of the largest companies in America. This spreads your money across various buckets, ultimately lowering your risk and expanding your opportunities.
Those are just two simple steps you can take to get started. The bottom line is that you don’t have to be a pro-investor to diversify your portfolio… anyone can do it.
4. Your daily coffee fix adds up
Okay, this probably isn’t the main culprit of your financial issues, but it could be contributing to them.
Don’t get us wrong — we love a good Starbucks or a nice dinner out, but we also have other more essential expenses to pay for as well. That’s not to say that you should stop going out altogether, but cutting back on the frequency in which you do could give your bank account a nice boost.