There are so many things in life we cannot control. A stock market crash, a global pandemic or other natural disasters come regardless if we’re ready for them or not. What’s more, sometimes the things outside of our control cause us to lose focus on the things we still can control, like our finances. So, how are your savings coming along? Are you spending less than you’re making? Here are some things to do to keep you focused on your finances.
Before you do anything else, come up with a plan for your money. Once you have a plan, you have to stick with it. It’s hard to plan if you don’t know how much is coming in and going out. Budgeting your money always gives you an advantage. It lets you know where your money is going and whether or not you’re overspending. Here is a great online budget calculator to get started.
Set Financial Goals
Now that you have a budget, you need to determine what it is you’re trying to achieve with your money. Set some financial goals, incorporate them into your budget and most importantly: stick to the budget. The only way to achieve your goals is to stick with the measures you set in place to get there.
Start Paying Down Debt
Your financial goals will never come to pass if your debt is exceeding what you can handle. Debt is a huge financial burden that weighs us down and keeps us from reaching our dreams. It’s time to get your debt under control. Make sure your budget plan includes a reasonable method for paying off your debt.
Know and Understand Your Credit Score
As with your debt, your credit score can make or break your future. That three-digit number can have an alarming impact on everything you do in life. In essence, if our credit score is not good, it keeps us more in debt because anything we borrow will incur an astronomical interest rate that seems impossible to pay back, causing us even more stress.
Check your credit score often or at least once a year to review any errors in the reporting. Each of us is entitled to one free credit report each year, but most of us never check it. You can also check it as often as you’d like using a comparable financial app. Get in the know with your credit report and credit score today.
Grow an Emergency Fund
An emergency fund is critical. Unexpected events and life emergencies will come. If you’re not financially ready to tackle it, it could cost you additional stress, a high-interest loan, and a mountain of financial worry.
A good emergency fund has three to six months of expenses saved up. If that seems out of reach, shoot for one month’s worth of expenses and work your way from there. Start small, like $25 or $50 monthly, until you’re able to do more. Eventually, you’ll get there.
Compare Insurance Options
Are you adequately insured? Does your insurance do everything you need? Insurance is an expensive but necessary expense, so make sure you’re properly insured. Remember, insurance isn’t just for your sake, but for your family’s sake as well.
Make sure you have the right insurance. Assess your insurance needs annually to ensure you have everything you need — renter’s insurance, homeowner’s insurance, health insurance, life insurance and disability insurance.
Automate Your System
Use a financial app to help you stay on track with your money. There are apps set up to monitor, measure and manage your personal finances. They can also alert you when you need to give special attention to certain transactions or your credit.
If you’ve ever thought about building long-term wealth, investing is a smart way to get you there. Starting early so you can invest over a long period is key. Find an investment option that works best for you and start as soon as you can.
Do your future self a favor and start saving now!
Contribute to Your Retirement
You may be a ways off from retirement, but it’s never too early to start saving for it. Just like investing, planning for your retirement will be easier and more effective if you start now. Retirement may require a lot more money than you realize, so make sure you’re setting accurate long-term goals.
There are so many things that we cannot control that take our attention off the important things. Your finances are important and it’s important that you stay focused so you can be prepared for financial stresses that could occur and especially retirement.
If you find yourself struggling in this area or you need to talk with a Wealth Advisor, JDH Wealth is here to help.....just reach out to us. We’d love to hear from you!