One of the most common goals of a new year is to get physically fit, lose weight or to become healthier. But have you ever thought about your fiscal health?
Along with being physically fit, being a fiscally fit person can reduce stress, increase your standard of living, make you happier and help you live longer.
According to a recent survey, 19% of consumers currently do not monitor their money, double what was reported just one year ago. Another survey reports that one in five Americans live paycheck to paycheck and 30% of people have no savings funds. It’s time to get fiscally fit.
The Kansas Credit Union Association offers these tip to get you on your way to becoming fiscally fit. Make goals, not resolutions.
Your resolution may be to get out of debt, grow your savings or stick to a monthly budget. While these are excellent resolutions, each requires weekly or monthly goals that describes how you will obtain the resolution. Outlining your goals creates an action plan that can help you stay on track and achieve those resolutions.
Be realistic. People whose goal is to lose weight don’t start off losing 20 pounds the first week. It’s unrealistic and unhealthy. Same goes for your budget. Start small. Can you eliminate one lunch out and save $10 a week? Can you trim $20 from your grocery bill?
Re-invest your money. Now that you are saving $10 a week, use that $10 to pay off other debt, save it, or start an emergency fund (if you don’t already have one).
Spend less than you earn. Sounds simple, but it is hard work. If you are trying to lose weight, you are told to burn more calories than you take in. Becoming fiscally fit is the opposite. You want to burn LESS than you bring in. Or in simpler terms, spend less than you earn.
Shop for the best price. Take a hard look at your financial institution. Are you getting the lowest rates possible on a loan? Are you happy with the service? Check around and make a switch if necessary. Do the same for your credit cards. You might find a card with a lower rate, saving you a few dollars each month.
Involve your children. A Capital One survey shows more than half of high school graduating seniors lack confidence in money management. Teach them about your own family budget. Not only will you be helping them prepare for their future, but they’ll gain a better understanding of where your hard earned money goes.
Remember, becoming fiscally fit is a long term commitment, just as becoming healthier takes time and effort. By making a few changes to your financial plan, you will be well on your way to having a stronger, healthier financial future.