Follow these tips and you’ll be on the right path to achieving your financial goals. It’s similar to following an exercise regimen – it’s never too late to start and the closer you stick to a routine the better your results!
1. ASSESS YOUR GOALS
Once a year, think about your short, medium and long-term goals. Are they still relevant? Are you on track to meet them? Long-term goals like traveling in retirement may not change frequently, but short-term goals like paying off a credit card or saving for a house may change more often.
2. BUDGETING IS A GAME CHANGER
Create a budget and stick to it! Following it will improve your finances greatly. If you currently make minimum payments towards your loan/ line-of-credit debt and cannot find extra money to apply to it each month, you need a budget.
3. MAKE A PLAN AND STICK TO IT
Now that you know your budget, make a plan. A plan for your finances helps ensure you’re on the right track to financial fitness. Ask yourself how much you need to cutback each month to reach your financial fitness goals, whether it’s paying-off debt, building-up savings or spending less than you make. Then decide where that money is going to go instead and write that down.
4. HAVE A FINANCIAL CUSHION
Living paycheque to paycheque is stressful. I recommend individuals have at least three months of living expenses in an emergency fund. It’s important to be prepared for unexpected life events and emergencies.
5. AVOID IMPULSE PURCHASES
Instead of making purchases based on an immediate desire, look to hold off and take a day or two to contemplate. It’s relatively easy to get caught up in the moment of shopping and feel drawn in. If after three or four days you’re still excited about the item, then make the purchase.
6. AUTOMATIC TRANSFERS INTO A SAVINGS ACCOUNT
Saving this way is the easiest and most successful way to save. Putting a portion of your paycheque into savings can help you spend less on impulse purchases, and you’ll have more money for emergencies, home or car repairs, school tuition and even retirement.