In this episode of Financial Advisors Say the Darndest Things, A.B. Ridgeway dives into the Rule of 72, a simple formula that helps you estimate how long it will take to double your money based on the rate of return on your investments. Whether you're investing in CDs, annuities, or the stock market, understanding this concept can help you set realistic expectations, manage risk, and plan for retirement more effectively. Ridgeway also explains why starting early is key to reducing risk and achieving financial goals.

Key Takeaways:

1. The Rule of 72 Demystified: The Rule of 72 helps you calculate the time required to double your money. Simply divide 72 by the annual return rate. For example, at 6% interest, it will take 12 years to double your money.
2. Setting Realistic Expectations: Financial advisors aren’t magicians who can double or triple your money overnight. The Rule of 72 provides a more realistic view of growth, helping you avoid unnecessary risk.
3. Start Early to Minimize Risk: Beginning your investment journey sooner allows you to take on less risk while still achieving your goals. Investing later often requires higher returns, which can increase your risk exposure.

Memorable Quotes:

1. "The Rule of 72 is a tool that simplifies complex financial projections, helping you make better decisions about where to put your money."
2. "The market rarely gives you a consistent 10% return year after year; it’s about staying the course through the highs and lows."
3. "Starting early allows you to take on less risk and still meet your financial goals—time is your greatest ally in investing."

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*Disclaimer: This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy or the completeness of any description of securities, markets or developments mentioned. This is strictly for information purposes. We recommend you speak with a professional financial advisor.

In this episode of Financial Advisors Say the Darnedest Things, A.B. Ridgeway provides practical and actionable tips for anyone struggling to save money, regardless of their income level. He tackles two key problems: the misconception that saving a set dollar amount is the key to success and the lack of clarity about what you're saving for. A.B. introduces the concept of saving by percentages rather than fixed amounts, offering a simple yet effective strategy to build the habit of saving. He explains how saving even a small percentage of your leftover income, such as 10%, can lead to gradual growth in savings over time. Whether you're saving for an emergency fund or retirement, A.B. emphasizes the importance of creating sustainable habits and understanding the purpose behind your savings goals. This episode will help you shift your mindset and develop a more effective approach to personal finance.

Key Takeaways:

1. Save by Percentages, Not Fixed Amounts – A.B. emphasizes that saving a percentage of what’s left over after bills, even if it's just a small amount, is more sustainable than setting a fixed dollar target. This method encourages building a habit of saving consistently.
2. Know What You’re Saving For – Before you start saving, it's crucial to define your goals. Whether it’s for an emergency fund, retirement, or something else, having clear intentions makes your saving efforts more focused and effective.
3. Gradual Growth Leads to Financial Security – By saving small amounts consistently, you’ll develop the habit of saving, which can eventually lead to larger savings as your income increases or expenses decrease.

Quotes:

1. “You are going to invest or save by percentages. Everyone can save by a percentage. It doesn’t matter how small. The important part is getting into the habit.”
2. “If you don’t know what number is going to give you financial security, you’re always going to be wanting more, because there’s always one more dollar to make.”
3. “The key to saving for your future isn’t how much you save, but the habit of saving. Even a small percentage over time makes a big difference.”

💵Sign up for a Christian Finance Consultation and create your Financial Plan Today!

https://calendly.com/abridgewaywm/consultation

📖Free E-Book- 4 Pillars to Christian Investing: https://mailchi.mp/abrwealthmanagement/christianinvesting

🏠 Visit our Website: https://www.abrwealthmanagement.com

*Disclaimer: This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy or the completeness of any description of securities, markets or developments mentioned. This is strictly for information purposes. We recommend you speak with a professional financial advisor.

3 Key Takeaways:

1. The Power of Delayed Gratification: A key insight from a listener highlights the importance of delayed gratification, particularly in the context of building wealth. By sacrificing immediate luxuries (like a fancy car or luxury condo) in your younger years, you can set yourself up for financial freedom and stability in the future. This concept extends beyond money, offering a powerful way to achieve long-term goals.
2. The Role of Emergency Funds and Credit Cards: Another listener shared an insightful approach to balancing emergency funds and credit card use. The advice: build a solid emergency fund of 6-12 months before using credit cards. Once that safety net is in place, credit cards can be used wisely to build credit, but always paid off to avoid debt.
3. Sacrifices and Trade-Offs in Life: A thought-provoking comment discusses the inherent sacrifices in life. Each choice comes with trade-offs—choosing one thing means letting go of another. This concept of "opportunity cost" is central to personal financial planning and lifestyle choices. Understanding this helps you make intentional decisions, rather than being driven by external pressures or impulses.

3 Quotes:

1. "Better financial health leads to better mental health, too." – This comment encapsulates the holistic benefits of financial discipline, emphasizing that financial stability not only brings peace of mind but improves overall well-being.
2. "Life is a series of sacrifices. To choose one thing is to give up another because for us, time and energy is finite." – A comment that beautifully sums up the reality of making decisions, whether in financial matters or personal life.
3. "It’s better to have money and not need it than to need money and not have it." – A powerful reminder of why financial planning and delayed gratification matter—having financial security allows you to live life without constant stress about money.

These podcast notes reflect on the insightful feedback from listeners, focusing on themes of personal finance, delayed gratification, and the sacrifices we make for a better future.

💵Sign up for a Christian Finance Consultation and create your Financial Plan Today!

https://calendly.com/abridgewaywm/consultation

📖Free E-Book- 4 Pillars to Christian Investing: https://mailchi.mp/abrwealthmanagement/christianinvesting

🏠 Visit our Website: https://www.abrwealthmanagement.com

*Disclaimer: This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy or the completeness of any description of securities, markets or developments mentioned. This is strictly for information purposes. We recommend you speak with a professional financial advisor.