It’s never too late to commit to financial health. Here are five financial practices that are fiscally healthy, practical, smart, and relatively easy to maintain.
1. Track your spending.
Maintaining a record of all your expenses is the simplest way to create an accurate picture of where your money goes. Include the necessities—such as mortgage payment or rent, utilities, car payment, commuting, insurance, clothes, groceries, and phone—and the extras—including designer coffees, dining out, movies, entertainment, and more clothes. (Oh, wait…that last one is mine.) If you spend more than you make, it’s time to revisit your priorities. Your financial health depends on it.
2. Pay down your debt.
According to cardhub.com, the average American household owes just under $7,000 in credit card debt. If you’re currently carrying credit card debt, the best advice is to pay it off and not add to it. Determine how much you can afford to pay each month—then do it.
3. Save more.
Fiscal health means having enough savings to get you through unexpected rough times. Sounds simple, right?—yet many people put savings at the bottom of their priority list. Move it up to the top, and commit to setting aside a fixed amount every month.
4. Learn your credit score.
It’s critical to know what your credit report says about you. Annualcreditreport.com is the only source authorized by federal law to provide you with a free copy of your credit report from each of the three credit-reporting companies every 12 months.
5. Reset your retirement savings.
Are you contributing enough to your IRA? If you feel you can kick in a bit more on a regular basis, by all means—do it.
You just might thank us when these simple habits turn out in your best interest.