Like Physical health, financial health is fundamentally key to leading a happy and successful life. Less than 1 in 3 Americans are considered “financial healthy” that’s according to financial health network.
Creating a sound financial present does more than alleviate current stress, it lays the foundation for a stable and secure financial future.
While there’s no specific number or score that measures your financial health, people with good financial health pay close attention to things like credit debt, saving investment and retirement.
Evaluate your financial health
But if up till this time you haven’t evaluate your financial health, you are not alone will can help you during the process because evaluating your by financial health. you determine what adjustments you need to makes in life. To reach the level of financial stability you’ve set for yourself.
Do now can be the best time to put your grown-up pants and take your money seriously, I want to help you get into a solid financial position. And the good news is, it doesn’t matters where you’re starting from! This principles can walk you through to your desire level of financial health. No matter how much or how little you have.
1. Where are you starting from.
If being financial healthy is your goal you’ve got to know we’re you are starting from, and where to start from is by assessing your believe system.
“mind is the master power that moulds and makes man, and evermore he takes the tool of thoughts and shapes what he wills, brings forth a thousand joys, a thousand I’lls. The things in secret and it comes to pass, environment is but looking grass....James Allen
Most people don’t really take the time and sit-down to evaluate what they really believe about money. For some money is the root of all evil to be avoided at all costs. Not to be talked about, demonized. For others money are there enemies. For others, money is everything. They’ll sacrifice friends, family, and integrity to get it. It’s a dog-eat-dog world. And for others money is merely a tool.
For better and for worse our understanding about money often shapes our financial health. Because what you believe about money determines how you handle it. When your believe about money is wrong, your behavior towards it will be accordingly. But due to my rich and little experience, and knowledge in this field. I thought it’s foolish to spend your life working for money and pretend that money isn’t important. Or that money is evil when actually not having it that is evil,
Because when you get the money you went beyond good intention, you can then have a lot to.
- raise your kids.
- support the gospel and donate to charities.
All of this takes money and being passive with money can’t help solve it, get to identify money as a tool and you increase your financial health tremendously.
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2. Tell your money were to go.
“A budget is telling your money were to go instead of wondering were it went”John c Maxwell
People who become successful at anything reach a point where they wake up to the reality of there decisions, and then they commit to make a change, it’s no different when we are talking about money.
If you want to take control of your money. There is only one answer make a budget. That’s means figuring out what is going out and what is coming in. Every month before the month begins. And where it is going.
“plan carefully and you will have plenty; if you act too quickly you will never have enough”Proverbs 21:5 GNT
Then what is a budget
The word budget can get a bad rap. People thinks budgets are hard, time-consuming and restricting. Sure, it can takes a couple months to get use to the process of budgeting. But once you get the hand of it, you will see why using it is so worth the effort too. Because it doesn’t tells you how to spend instead it gives you permission to spend the right way.
So what is a budget? A budget is a plan. A plan of what? of all you’ll do with your money not only of how to pay bills.
You can use it powerfully as a catalyst of financial freedom, when you budget to pay yourself first before any other expenses. You’ll see that not long all your financial worries we be gone.
3. Start spending less than you earn:
I realized it’s nomal to “live it up” and spend your whole paycheck. That’s why 78% of Americans lives paycheck to paycheck! This is a conventional wisdom that has help many improve there financial health.
Borrowing from your future to keep up the present lifestyle you can’t afford doesn’t have to be your story especially if you want to be financial healthy. You make a choice today to live differently, by cutting your expenses and save to buy asset. you can choose a life of freedom- and- live a life on your terms not Visas.
The way to get this done is by living on less than you spend, there we always be temptations coming towards you, from every direction because everybody want a piece of your paycheck. Am I right? But you get to fig in your heels and say. Nope, I choose to live wisely and within my means till when I increase my means.
Below are some helpful tips to live below your means.
- Keep diligent track of your spending(Budgeting): keep a notebook in your pocket and write down every expenses you have_the simple process of doing this will make you think twice about unnecessary expenses, when you do have a months worth of expenses. Written down, take a careful look at then. Ask yourself whether each of this expenses really contribute to your value
- Go through every monthly required bill: ask yourself if you really need that service at all, do you really use Netflix all enough? or could you just rent a movie once in a while from Redbox? Do you really use your cell phone much at all, or could just replace it with pay-as-you-go phone? Then go through each bill and see if there are any optional services you can eliminate.
- Get a better bank: the vast majority of Americans are with banks that don’t treat them very well, no interest at all on the checking accounts. Tons of fees for ATM uses. Draconian overdraft policies, a tiny interest Rate on saving accounts, all of this things are waste of money. Switch your account to a bank that respects you and can save you money.
- Look carefully at your routines: watch what you do everyday or (most days) are there things you do each day that cost money? Those things are the most powerful to adjust, as trimming just $1 from daily spending saves you $365 a year, do you stop at coffee shop each day? Why not cut down your daily order a bit, or switch to different shop. Or start making your coffee at home.
4. Don’t live below your means:
Has I said in the previous verse that you live below your means to cut expense and save that money for investment. Yes it one side of the coin, but for you to live in financial abundance, live to your dream, you have to be more, unless your dream is too small. You’ll live below your means
Anybody can cut expenses, and anybody can hope and pray that money will come in, but it’s takes creativity, knowledge; and darling to grow your income- to expand your means. You don’t have to spend the whole of your live living below your means, You can grow And expand. But it may need some adjustments in teams of behavior towards learning.
Ways to start increasing your income
- Don’t waste time at work: the time you spend sitting idle, browsing the web, or chatting on Instagram or Twitter with your buddies is time you’ve effectively lost instead invest that time in something devoted to your career, Even if it’s not directly on a work project, there are losts of things you can always be working on.
- Work on your transferrable skills: I’m a big believer in transferrable skills that one can utilize in almost any carear path. Work on mastering such skills. Numb on any and all opportunity to speak in public, hammer out an effective time management scheme for you, get into a routine of organizing and filling your paperwork, Brainstorm ideas for things going on in your office, write clear documentation for the standard procedures of your work. Step up to the plate. Take charge of a work project and get the ball moving forward. All this push you toward developing a skill that are genuinely useful.
- Start a side business: I don’t mean filling out survey or other things you can use to burn a few minutes during commercial break and earn a few pennies. I mean actually devote serious time and effort to turning a passion you have into a money-making Enterprise. What could possibly be? That’s why you need the right knowledge that can field you through. which is financial education.
“don’t worry much about living below your means, rather take all your mental energy to cut expenses and look how to expand your means”
5. Plan for your future:
Nothing will make you feel more financially healthy than a stockpile of cash sitting in the bank, waiting for a rainy day, and a cash flow investment portfolio rotating cash-in monthly.
A emergency fun first, and later a cashflow investment which quarantees you safety on the long run. Because if you don’t have a emergency fund you will reach out for a credit card when your cars break down, and that will turn a car problem into a money problem. Then compound interest turn the money problems into more money problems and later into debt. Stress and worry that’s not good for your actual health.
But when you have money in the bank just for emergencies, you can simply get the car fixed no stress. No drama. And your financial emergency fund is there to protect it.
Begin with a starter emergency fund of $1,000. This will cover smaller emergencies while you are starting, but later build it up to fun perfect three to six month of living expenses.
After your six month emergency is fully covered you can then went forward to cover a lifetime of emergency. (Investing in cash flow)
Lots of people think their 401(k)s and IRAs which have stocks, bond or mutual fund holdings, has investment but I consider then saving plan. People with such investment are what I named passive investors. But their is another way to a more carefree investment, which is investing for cash flow. You buy a piece of property upgrade it, then rent it out and began to receive a monthly income through rent. And with this monthly income you pay the mortgage and still have some pie of cash