Most of us take daily steps to improve our health, whether it is by brushing our teeth, getting eight hours of sleep, or drinking green juice. But how many of us take the time to improve our financial health?
Whether you are in debt or just in need of a little financial assistance, here are five money moves you can make today to improve your financial health and get on track.
1. Understand Your Company’s Retirement Program and Increase Your Contributions (If You Can)
Does your company offer a 401(k)? If so, do you know if you contribute to it and do you know all of the details about the plan? Take some time today to look into your company’s 401(k) plan. Some things you should know are:
- What is your current 401(k) balance?
- How much (if anything) do you contribute to your 401(k) from each paycheck?
- If you keep up that contribution pace, will you have maxed out your contributions by the end of the year? Is this a financial goal of yours?
- Does your company offer a match?
Based on the information you gather, come up with a plan. Perhaps you realize your company matches but you have not been contributing at all. This is a great opportunity to begin contributing, at least up to the match percentage, as not doing so is essentially leaving free money from your employer on the table.
Regardless of whether you make any changes or increase your contribution amount, assessing where you stand and what are the details around your 401(k) plan will improve your financial health and set you up for a healthy retirement.
2. Develop a Budget
Like going to the dentist and protecting your oral health, facing our money head-on and developing a budget is something many of us do not look forward to doing but are relieved and proud of ourselves for doing once we are done.
One of the best things you can do for your financial health is to know where you stand and develop an action plan (i.e., a budget) for your spending going forward.
First, gather all of your bills and expenses from the prior few months (or an entire year, if you are feeling ambitious) and determine how much you spend monthly. From there, look at your income and see how it matches up. Are you bringing in enough money to cover the amount you spend? If not, figure out where you can cut back. Put this information all together to come up with a budget you can follow going forward.
3. Check Your Credit Report
Have you buried your head in the sand when it comes to checking your credit report and knowing your credit score? Face this head-on and check your credit report and credit score.
A credit score is an important financial number for many reasons. Lenders will look at your score when they decide whether to offer you a loan and at what interest rate. Landlords will look at your score when they decide whether to rent you an apartment. For these and many more reasons, it is important to know where you stand when it comes to your credit score.
In addition to your credit score, your credit report will show more information on your financial activity. By checking your report for any mistakes or unusual activity, and reporting those errors, you are protecting your financial health and your financial future.
4. Start an Emergency Savings Fund
If you have not already started one, there is no better day than today to set up an emergency savings fund. If you do have one, check your balance and determine whether you are comfortable with the amount of money saved. If not, develop a plan to increase your savings until it reaches a level you are happy with. A great goal is to have three to six months of expenses saved up.
Why do you need an emergency fund? Whether it is a medical emergency, car accident or home repair, unexpected things can happen to us at any time. An emergency fund is a key to making sure you are financially prepared for any of these emergencies should they occur. Protect your financial health by starting one today!
5. Assess Your Credit Card Debt and Develop a Plan to Pay it Off
Do you have one or more credit cards? Do you know the outstanding balance and interest rates on each of these cards? If not, the first step to improving your financial health is assessing where you stand when it comes to your credit card debt.
Go through each of your cards and make a list of the amount you owe. Next, figure out the interest rate on each card and order the cards from lowest to highest interest rate. If you can, develop a debt-payoff plan, paying off the highest interest rate card first and working your way through until all your debt is paid off.
If, after you have assessed your credit card debt, you determine that you cannot pay the total balance off on your own, a debt settlement company like https://cwdebtrelief.com/debt-settlement can assist you. Reach out to one to learn best debt relief options for you, which might include credit card consolidation (where you consolidate your credit card debt onto one, lower interest rate card) or debt settlement (where a debt relief company negotiates with your creditors on your behalf to pay your debts off with one smaller, lump-sum).
Yes, You Can Improve Your Financial Health in Just One Day
There is no better day than today to choose one (or more!) of these five tips to improve your financial health. Whether you start by looking into your retirement, setting up a budget, checking your credit score, starting an emergency fund or strategizing a way to pay off your credit card debt, you are guaranteed to improve your financial health, one step at a time.