There are behavioral issues to address as well. Your advice is pretty solid, so I’m not advocating major changes, but it’s worth mentioning these possible confounding issues (really one issue stated 3 ways):
For most, the small daily decisions (whether and how much to spend on optional consumption) FAR outweigh the rare, larger “financial planning” decisions. It’s far better to save more than to optimize where you put it.
For many, the fact that they _have_ any credit card debt is testament to the fact that they spend badly. If one has a “set level” for tolerable amount of debt, then paying it down is useless because you’ll soon borrow back to it.
Some investments are psychologically or legally difficult to cash out. If you have imperfect spending/saving habits, these investments are better than their risk-adjusted RoR would imply.
Basically, if you care about your distant-future self more than you care about your near-future self, it makes sense to optimize your investment ecosystem to remind your near-future self about that preference.
There are behavioral issues to address as well. Your advice is pretty solid, so I’m not advocating major changes, but it’s worth mentioning these possible confounding issues (really one issue stated 3 ways):
For most, the small daily decisions (whether and how much to spend on optional consumption) FAR outweigh the rare, larger “financial planning” decisions. It’s far better to save more than to optimize where you put it.
For many, the fact that they _have_ any credit card debt is testament to the fact that they spend badly. If one has a “set level” for tolerable amount of debt, then paying it down is useless because you’ll soon borrow back to it.
Some investments are psychologically or legally difficult to cash out. If you have imperfect spending/saving habits, these investments are better than their risk-adjusted RoR would imply.
Basically, if you care about your distant-future self more than you care about your near-future self, it makes sense to optimize your investment ecosystem to remind your near-future self about that preference.