National Financial Wellness Month Focuses on Finances
January celebrates National Financial Wellness Month, and in today’s economy, now is definitely the time to pay close attention to spending and financial health. Now, more than ever, it is important to be smart with your income and planning for your future.As the economy falters, you don’t have to. Here are some steps to take in the new year to improve your financial health and wellness:
1. Make a budget – Budgets are a necessary evil. They are a practical way to get a grip on your spending and to make sure you are using your money the way you want to. A budget can be made in three simple steps: identify how you are spending, evaluate your spending, make goals, and track your spending. Using personal-finance software can make this process much easier.
2. Live beneath your means – While this may seem like basic common sense, it’s not always easy to follow. Simply put, you should spend less than you earn. This is the key to establishing financial independence, reaching your financial goals and keeping your stress level low. There are many ways to do this, such as buying store brands whenever possible; buying used books instead of new; brown bag your lunch; and stay away from designer label clothes.
3. Pay off your credit cards – Credit cards are a very expensive form of debt. Commit to always paying more than the minimum payment, and pay down higher interest cards first.
4. Pay yourself first – Always put money away in savings before you pay anyone else. Doing it right when you get paid or setting up an automatic transfer from your checking account can help you develop strong saving habits and reach your long-term goals faster.
5. Save six months’ living expenses – Think of this as a “rainy day” fund. For most people this would serve as a nice cushion if something were to happen and you no longer had a source of income.
6. Make a will – This is especially important if you have dependents. A basic will is easy to write and anyone that has acquired any assets should have one. There are many online resources to help you get started.
7. Seek wise counsel – You don’t need to do it alone. There are many financial planners out there who work on a fee-only basis. They can help you develop a life-long plan to keep you financially stable.
8. Fund company-sponsored savings plans – You can accumulate significant savings in these plans. And what you contribute is often taxdeductible. Speak with your company’s representative to find out which plan would be right for you.
9. Plan major expenditures – For large purchases, such as a house, new car or college education, make a plan to reach your goal.
10. Educate yourself – Financial publications can be a good source of information. Taking a course on basic financial management can be a big help, too. Community colleges often offer these types of courses.
Source: Wellness Council of America and CNN Money. |
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