Are you financially fit? Have you ever faced the question squarely without squirming? You receive a fat paycheck each payday, periodic bonuses, and commissions. You're living comfortably within your means. But frankly, should any financial disaster or emergency strike, will you be able to cope financially? Answering the question in the affirmative means, you can take on anything because you're financially stable. But if you're not, what should you do?
Organize Your Finances
The first step towards financial health is organizing your finances, similar to setting up your household budget and setting aside a little something in the cookie jar. However, this arrangement calls for saving money towards the future without depriving your family of the necessities in life.
Organizing your finances toward financial stability requires a realistic assessment of your financial capabilities. Starting out requires a list of all your incoming resources and average monthly expenditures. Saving 10% of your income should be top priority no matter how difficult the situation.
When you get your paycheck, get your 10% immediately and deposit it in an interest earning account. Consider the money spent and forget about it. The remaining amount should be carefully budgeted and bills should be paid immediately to avoid the accumulation of additional charges. Working toward your financial stability is no mean feat, so bolster your resolve to stick to your budget.
First Things First
To get financially fit, take stock of your assets and liabilities. Financial heath is being debt-free. So start paying off your debts and don't mire yourself with new loans. With your partner, go over your credit card debts.
Segregate the small credit amounts and start paying it off before their interest rates grow to unmanageable proportions. Pay the other credit card debts as you go along. Eliminate each fully paid credit card and glue it somewhere where you can see you these-sort of trophies for your efforts towards a financially stable future.
If you're employed, don't scrap the retirement plan made available by your employer. Consider this as forced savings towards your future retirement and financial stability. This is an added bonus when you retire. With careful and sustained contributions, you can retire happily and receive your monthly pension checks and not worry how to support yourself when the time comes.
To be financially sound, resort to measures like investing your money. Mutual funds are becoming popular investments prospects. These yield higher returns and are stable even in the threat of inflation. Energy stocks are also profitable investment options. If you are unsure about investment procedures, ask expert assistance to build your investment portfolio.
You can also try your hand in investing in foreclosed homes; this is another viable way to become financially fit. But before you do this, make sure you have a substantial amount saved that can finance the project or if you are going to take a cheap mortgage you won't need a big mortgage amount to finance your investment.
Online investment experts can help you understand and manage your personal finance affairs. This is better than doing it yourself if this your first attempt to organize and manage your money so that you can be financially fit.