Financial Fitness - Getting Your Finances Into Shape
The Importance of Financial Fitness
Here we are in January 2021. We survived 2020, but we can't start slacking off in the new year. This is the time to get your financial plan in order and make this year work for you! .....
Forget carbs, fats, and proteins! Let's talk about savings, retirement, and cash flow! .....
Just like physical fitness, financial fitness requires patience, time, and commitment. But those efforts really pay off!
According to Rahul Jain of MoneyControl.com (2018), financial fitness can help you:
Achieve financial security
Achieve financial independence
Create goals for each stage of your life
Create a financial plan
Build an emergency fund
Plan for retirement
7 Tips To Get Your Finances Into Shape!
1.Control Your Spending
We all know it's not what you make but what you spend. Create a budget and stick with it. Planning helps you be in control and helps you make sure your money is going where you want it to go.
2. Understand Where Your Accounts Are
Often times, people have multiple bank accounts, insurance through different companies, or retirement accounts in a variety of place. Make sure you know where all of your accounts are and consider consolidating them.
3. Have An Emergency Cash Reserve
If 2020 taught us anything, it's the importance of preparing for unanticipated situations. Be sure you have saved up cash to cover at least 3-6 months of expenses and hold this emergency cash reserve in a high-yield savings account.
4. Make Sure Your Insurance Actually Covers Your Needs
Have you looked into your insurance coverage lately? You don't want to find out in the aftermath of a disaster that you don't have enough coverage. Consider reevaluating now to be sure you're ready for any situation that may arise.
5.Review Your Investments
Lack of diversification and high fees can be negative drains on your investment growth. They're small and insidious and often go unnoticed. Consider reviewing your investments to reduce or eliminate these potential drains.
6. Create Savings Buckets
Do you have dreams of a new home? A grand vacation once COVID is over? Consider creating multiple savings accounts to plan and save for each
of these events. That way, you can place a strong offer on your dream home or enjoy your vacation knowing it's all paid for in advance.
7. Celebrate Your Victories
Did you pay off your student loan? Celebrate it! Each financial milestone is important and should be recognized and celebrated as a crucial step on your money journey.
Don't know where to start? Feel overwhelmed? I'm here to help!
I'm Coach Ella, a certified life coach and financial advisor, and I'd be happy to help you get your finances into shape.
Ella Financial Planning and Coaching Clarity, Partnership, Confidence
Jain, Rahul. (2018, November 17). Why is it important to be financially fit. Money Control. https://www.moneycontrol.com/news/business/markets/why-is-it-important-to-be- financially-fit-3190801.html