Using a budget to improve your financial wellness gives you a sense of security when it comes to your money. You'll be ready to face emergencies head on while also preparing for your future.
Not sure where to start on your financial wellness journey? Here are six tips you can incorporate at any stage of life.
1. Create a Budget Tracking System
Whether you're tracking due dates on pen and paper or linking your credit union accounts to a budgeting app, it's important to know where your money is going and when. Whatever method you choose, use a system to track your income as well as spending. This will give you insights into any areas where you could potentially cut back to save or reallocate elsewhere.
2. Prioritize High-Interest Debt
Tackling outstanding debt that has a high interest rate attached significantly contributes to your financial wellness. You'll save large amounts of money over time, and finishing those monthly payments allows you to redirect that money into other savings goals. Look at all of your credit card and loan amounts and prioritize extra payments on the ones with the highest APRs.
3. Automate Your Savings and Bill Pay
Take advantage of automatic transfers and Bill Pay to manage your money as simply as possible. Scheduling automatic transfers to your savings account on pay day ensures you make those deposits. And enrolling in Bill Pay keeps you on track with your due dates. You also improve or maintain a healthy credit score by making your payments on time.
4. Boost Your Emergency Fund
59% of Americans don't have enough cash on hand to cover a $1,000 financial emergency. Evaluate the current size of your emergency fund and see if it could use a little boost. Most financial experts recommend having at least a few months of living expenses saved in case you lose your job or have a medical issue that prevents you from working.
5. Schedule Regular Check-Ins
Stay on top of your money with regular check-ins at least once a week. Pull out your budget track or financial app to see how you're doing with your budget. Note any unexpected expenses so you can plan for them in the future. A weekly spending review is especially important if you're in a relationship and share expenses with your partner. This helps improve communication so you feel like a team working towards the same goals.
6. Envision Your Future Self
Your short-term goals are important, but so are your long-term ones. However, they can be hard to prioritize if you can't visualize what your life will be like in the decades ahead. That's where your future self comes in. Think about your dream retirement and walk through a vision of yourself living out those goals. That can serve as extra motivation when you don't want to make an extra 401(k) contribution or increase your long-term savings by a small percentage each year.
Grow with ACU of Texas
ACU of Texas is here to help you achieve financial wellness, whatever that means to you. Join today to set up all of the accounts and budgeting tools you need to feel confident in your money for today and tomorrow.
