It is a new year and the perfect time to take control of your financial well-being. The holiday spending season is over and now you can focus on building your financial security to not only put your mind at ease, but also make you feel less vulnerable to any economic instability or surprise expenditures. Financial wellness includes being in a state where you can comfortably manage bills and expenses, plan for long-term financial goals like retirement or college savings and have the money to handle emergency situations. Here are a few tips to help you on your way to financial wellness:
PAY OFF DEBTS
Debts are a constant burden on an individual and normally cost more the longer you take to pay them off if there is interest involved. Whether it is credit card bills, insurance, car payments, loans, or mortgages, paying off debts is a difficult, but necessary part in achieving financial wellness.
MAKE A BUDGET AND REDUCE COSTS
Start learning how to spend money smartly. Set a spending limit when you go out to stores, buy in bulk whenever you can, look for deals and coupons, buy generic (store-brand) products, and ask yourself, “Do I really need this?”
Try carpooling and sharing the cost of gas with friends and family to relieve the burden. Staying home instead of dining out will not only reduce the cost of driving, but also cut the expensive costs that come with eating meals at restaurants.
Cancel subscriptions to services that you no longer use or may not need. The monthly fees of streaming services, newspapers, and magazines may not seem like a lot of money, but you would be surprised how quickly they can add up.
START SAVING AND INVESTING
Once you can reduce your day-to-day costs and pay off debts, you can start to save the money you are not spending. Make an emergency fund in case something unexpected happens like loss of employment, health problems, natural disasters, or something else that could reduce your revenue or increase your expenses.
Once you have enough money in the emergency fund, excess can either be invested so that your money works for you, placed in retirement funds, used to purchase different layers of insurance, or used to support college or other funds.
Changing your daily habits and actions and setting clear, measurable goals, no matter how large or small they may seem, can contribute greatly to building financial wellness that will lead to a more enjoyable and secure 2023 and overall future.
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. Happy new year from our Point Breeze Credit Union family to you and yours.