National Financial Awareness Day
Financial awareness is both a mindset and a strategy that ensures you’re making, spending, saving, and investing money in a way that maximizes your chance of success.
Elements of financial awareness include the following:
- Familiarity with ways to save money
- Full understanding of your income and spending habits
- Protecting the money you have saved
- Knowing when and how to borrow money
- Insight on how to make your money go further
- Knowledge of financial instruments (stocks, bonds, funds, etc.) and how to use them
- Creating a monthly budget and long-term investment plan
No matter where your finances stand and the stage of life you are in, it is never too late to learn sound principles that will help you plan for your financial future. These include making small changes in daily habits, saving whenever possible, and conducting responsible investment processes. We can help!
Here are some ideas:
• Save money: Open a savings account and commit to putting away a small amount of money in savings every week and never touching it. Many financial experts suggest putting at least 20 percent of your income into savings.
• Spend less: Make small changes to your spending habits to save money, such as drinking water instead of soft drinks or alcohol when you eat out, walking or biking instead of taking a car, or turning up the thermostat a degree or two to save on energy costs.
• Improve your credit: Review your credit reports, you are entitled to a free report each year (tip: use soft inquiries, so you don’t accidentally ding your credit score). Make sure you pay off your credit card each month. Avoid late payments by tracking your bills and setting up automatic payments or payment reminders. Strive to only use less than 30 percent of your credit limit, since that’s a major factor in determining your credit score.
• Start investing: No better time than the present to get started. The earlier you start investing, the longer time value of money works in your favor to grow wealth. Give us a call today!
• Budget: Create a budget for the year https://www.maxwellforsman.com/files/monthly_household_budget.pdf. Knowing where your money goes each month is a great place to start. Find how much you can budget monthly and start saving!
• Create an emergency fund: Medical bills, job loss, or a sick pet can be expensive to cover. Instead of choosing between going into debt or not paying for something you need, put money into an emergency fund that will help protect your finances if anything unexpected occurs in the future.
• Build your retirement fund: Most retirement experts recommend contributing 10 to 15 percent of income towards your 401(k) or another retirement fund. If that’s too big of a commitment for your current income, start contributing as much as you can and slowly work your way up to that goal.
We hope these tips help create a financial awareness mindset. If you have any questions feel free to give us a call
(856) 582-3500. We are here to help any step of the way!
