As Financial Literacy Month Ends ... Important Reminders to Share.
Financial Literacy Month is an important reminder to reflect on your financial wellbeing whether you are twenty or seventy. It is vital to reflect on your current situation and to understand how it can be improved, as well as how to save for the future. Avoid regrets down the road and start saving for the future today. If you find you find that you are at a point in life where you regret not saving sooner, don’t despair. Meet with your financial advisor, who can help you determine how much you can afford to save monthly, and what other steps you can take to jump start your savings. It’s never too late to improve your financial health and save for the future. Here are some tips!
Challenge yourself with goals
Now is a great time to review your portfolio and decide if there are improvements you wish to make. Set short, mid, and long-term goals with a specific purpose and dollar amount. These should be achievable goals that will challenge you to enhance your financial health. Short term goals should be achievable within two years, mid-term within two to five years, and long-term goals more than five years. A short-term goal might be to create an emergency fund by saving a set amount each month for the next year, whereas a long-term goal would likely involve retirement plans.
Expect the Unexpected
Financial Literacy Month is a good time to sit down with your advisor and discuss how your finances would weather an unexpected event or emergency. Savings can easily be depleted after expensive health issues, loss of a job, or the loss of a spouse. Life is unpredictable, so its important to be prepared financially. It’s recommended that you have an emergency savings fun with at least six months of living expenses. Regular financial checkups will help you stay on top of your finances and be sure that your savings and investments are progressing as needed.
Communication is Key
If you share your life and finances with another person, it’s important to discuss finances together. Discuss topics such as your savings plan, your comfort level with investment risk, and your retirement goals. Make a budget and decide together on spending and savings amounts. Have a plan for emergencies. If you have kids be sure to talk to them about financial health as well. Teach them about the importance of saving money with a piggy bank and savings goals.
Commit to Financial Health
Once you have a budget and an investment plan in place it is critical to commit to it. Know your spending habits and make a concerted effort to make smart choices that keep you on track. Break down your spending into categories like groceries, entertainment, healthcare, etc. Track your spending to stay on track. Talk with your advisor about how much you can afford to save monthly based on your income and budget. Your advisor may recommend better investment options for your savings than a standard savings account. Make a plan and stick to it, and you will see your efforts pay off down the road.
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