You’ve probably done a lot of thinking about physical health. But what about financial health?
Financial wellness is an important goal that you should approach with the same strategy and vigor that you would use to get in better physical shape. Start small, focus on continued improvement and stick to a plan.
The first step is relatively painless. Review your credit report. Borrowing money isn’t the only reason to check your credit. Your credit score can have a huge effect on the amount you pay for auto and homeowners insurance, and sometimes on health and life insurance rates. You can get a free credit report once a year at AnnualCreditReport.com. If you find that you have a few dings, work toward getting them straightened out as soon as possible.
Building up a saving account is key in financial wellness. Setting up an Automatic Savings Plan (ASP) is probably one of the most convenient ways to go about it. It’s pretty common for employers to offer it through payroll deduction. All you have to do is specify how much money you would like to be deposited in your savings account each month. That way, you save it before you ever have a chance to spend it. Try to increase the amount you save at least once a year.
Just like many weight loss plans, it helps immensely to put it in writing. You can’t control what you don’t track. Take the time to look at your income and expenses for the year and adjust those numbers to reach your goals. Tracking your progress on a regular basis can ensure you not only stick to the plan but you can see how far you have come.
Paying off your credit cards could be one of the biggest steps to financial fitness. If you are in credit card debt, you are paying “rent” on the money borrowed in the form of high interest rates. So if you’re sitting on any extra savings, think seriously about using it to cut down credit card debt. Creating a monthly plan to pay down credit cards while tracking your progress will yield the best results.
Meeting with a financial adviser can put you on the right path in financial planning. Allow yourself to be held accountable by a third party who will push you to better yourself financially. They can assist you in developing a budget, looking at your debts and tax situation, retirement planning and more. The trick is finding a good adviser.
