Financial planning is already a difficult task for so many of us. And when you’re an immigrant in the United States of America, this planning can be even more difficult. I hope these 8 tips will help any of you out there who needs some basic understanding of good personal finance choices.

1. Start Saving for Retirement

Save for your retirement now. At least 10%, 15%, 20% of your income invested in low cost, broad based index funds in your 401k or Roth IRA. Try to spread your money 50/50 between an S&P 500 index fund and a Total Bond index fund.

If you need help understanding your investment options then join the Habesha Finance Facebook group and ask your questions there.

2. Your Retirement Comes First

Your children shouldn’t come to you for college funds. Your retirement is more important than paying for your child’s eating out or partying.

3. Achieve Debt Freedom

Focus on paying off your house, car note, and credit cards. Do your best to eliminate all your debt. This is going to take time and planning. If you need help make sure to join the Facebook mentioned in tip #1.

4. Stop Borrowing Money

Stop borrowing and cut the credit cards. Your emergency fund needs to cover 3-6 months of living expenses. Credit cards are not for an emergency.

5. Financial Planning Takes Time

Understand this will take time.

6. Apply for Term Life Insurance

Get life insurance if you can, a 10-30 year term life insurance policy in case anything happens to you. If you can get enough to cover the home you live in, kids college and life experiences like a wedding. If you can afford the monthly payment then try to get a higher policy amount at least 500,000.

7. Budget Your Income and Expenses

Budget budget budget. Your income needs to be on a budget. Click here for access to my favorite free budget.

8. Get a Written Will

Get a written will and estate plan set in place. Establish a health directive. If you have young children, you have to make a decision as to what happens to them in the event you are no longer alive.