You spend your time on social media, watching Netflix, scrolling TikTok, and a number of other relaxing, yet frivolous things. Those are all great, however, we want to remind you that you need to save some time to actively managing your finances. Generally, we are more likely to keep tabs on our physical and mental health but studies have shown your finances can make a huge impact on your stress levels which eventually impacts your health. Digging into those financial matters may not only make your wallet feel better…it may also make you feel better. So, now is a great time to check in, revamp your finances, reach your goals, and feel great!
Questions to ask yourself and things to consider during a mid-year financial check-up:
1. Did you set resolutions in January? If so, have you reached them or have they fallen by the wayside?
If you set financial resolutions for the new year, it’s time to take a look at those to see if you’ve reached them, and if so, look at what more you can do. If you haven’t quite reached those resolutions, it may be time to reevaluate where you’re at and make a plan to reach the ones you already set.
2. Are you spending wisely?
"You should be tracking expenses on a weekly basis, so you can identify your own spending trends and habits and correct course early on if need be” (USNEWS). When you stay on top of your spending you’ll know where you are in regards to reaching your goals.
One huge budget issue that we’re all guilty of sometimes, is being a little ‘click happy’! Now, more than ever, we are making a purchase with one click or tap of a ‘buy now' button on your smartphone. The downfall to this is that you’re not fully considering your purchase, how much it costs, or how it might affect your budget. A good rule of thumb for more expensive purchases is to wait for 30-days and decide whether you still really want the item, or if you can live without that item.
3. Are you splurging too much?
Many of us have the mindset of ‘treat yourself’. For some, treating yourself is truly that…a treat. For others, you spend too much too often. Generally, many people tend to go overboard when planning a vacation or for their favorite holidays. Their minds are made up that the items need to be nice, and expensive. In either situation – you can still have fun, treat yourself, and get nice things for others, when sticking to a realistic and affordable budget. In these situations, consider saving first, and then spending rather than the other way around. One tool to help with that is a Vacation Club or Christmas Club account with CSE. These accounts are designed to help you save for bigger expenditures and allow you to deposit money when you can or every pay so you’re not ruining a budget, but sticking to one.
4. Are you saving?
The Federal Reserve Board conducted a survey and asked respondents how they’d pay for a $400 emergency, “47 percent of respondents said that either they would cover the expense by borrowing or selling something, or they would not be able to come up with the $400 at all”.1
Saving for emergencies, something specific, or simply saving, in general, are all important and should be one of your top priorities when budgeting after paying off debts.
5. Do you have balances on your credit card that you need to pay down?
These may be one of the highest debts you’re accumulating especially if you have a high-interest rate. Consider a balance transfer to a low-rate card or a balance transfer special to save money over the life of your balance / until you pay it off completely
6. Are there areas where you are wasting your money?
Here’s a crazy figure to chew on.
“A 2018 survey on checking accounts from the financial comparison site MyBankTracker.com found that U.S. households wasted more than $1 billion in monthly maintenance fees at the top five banks alone last year. And in addition to bank fees, you may be wasting money on other fees that you no longer need or use. Review your bank statements in detail to find any recurring subscriptions that you need to cancel…”2.
If you’re paying for things that you don’t use or want, why? You’re throwing away money that could be used for just about anything else, most importantly saving!
7. Can your credit score improve your finances?
The short answer: YES! Checking your credit report is a great place to start when giving your finances a check-up. We like to refer to your credit report as your financial report card. The higher your score, the less you’ll likely pay in interest when you need financing. Visit AnnualCreditReport.com to get a free credit report from any of the three major credit bureaus: Experian, TransUnion and Equifax.
If your credit score has gone up since you’ve accumulated any debts, you may be able to reevaluate those loans and get a lower interest rate which will save you money and help you pay down your debts faster.
Another great thing to look at when doing a financial check-up is if there are any errors on your credit report. If so, getting those errors resolved will help your score. “Since your credit report dictates your credit score, reviewing your credit report in detail once a year or more is critical as you can spot and fix mistakes or take action against fraudulent activity quickly…Often times you are unaware of identity theft or any other accounts that could be opened in your name…” 2.
In closing, if you’re mid-year financial review is not quite up to par, that’s OK. There is still time to get on track and become a more financially fit person. If you need help, we’re here for you with a wide variety of products and services to help, plus we a dedicated Certified Financial Counselor on our staff who can help you set up a path for financial success. Contact us (link to contact page) when you’re ready to get going to financial freedom.
Resources:
1.) The Atlantic - https://www.theatlantic.com/magazine/archive/2016/05/my-secret-shame/476415/
Disclaimer
While we hope you find this content useful, it is only intended to serve as a starting point. Your next step is to speak with a qualified, licensed professional who can provide advice tailored to your individual circumstances. Nothing in this article, nor in any associated resources, should be construed as financial or legal advice. Furthermore, while we have made good faith efforts to ensure that the information presented was correct as of the date the content was prepared, we are unable to guarantee that it remains accurate today.
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