Not having positive money management habits can have a severe impact not just on your current finances but also on your future finances. Creating and sticking to good habits can help you feel more in control and give you a sense of confidence about your finances.
Here we have compiled 5 Steps to Being Financially Healthy:
Step 1: Evaluate Your Expenses
Improve your understanding by getting a comprehensive look at your spending habits. Reviewing every bank and credit card statement is a good start. Utilizing a program like AdviceWorks or Quicken is even better!
Step 2: Find Ways to Increase Net Income
We always think this is about cutting costs but it can also be from increasing what your household earns. The “gig economy” or side hustle can be a great way to bring in more money each month.
Step 3: Pay Down Debt
Financial freedom is about taking control of your money. Not having any debt is a great way to achieve that freedom. There are great programs and tools to have you achieve this goal. Do a quick internet search on the term and you will quickly find more than 700 million hits!
Step 4: Build a Financial Buffer
A critical component to keep from going deeper into debt is by having an emergency fund for those unexpected bills or layoffs. Consider adding a little more to savings each paycheck or saving that unexpected bonus from work.
Step 5: Save for the Future
Are you taking advantage of the 401k and potential matches your employer offers? You can also start an IRA and add a small bit each month. Giving yourself a pay raise in your retirement savings whenever you get a raise is a great way to increase your contributions each year.
Make these strategies your newest habits, and start on your way to a more effective money management journey. Contact the office and discuss how these healthy habits could make an impact on your financial plans.