Financial Wellness: 10 Ways To Practice It Every Day

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1. Track All Spending

First and foremost, the best way to practice financial wellness is to track all of your spending. That doesn’t mean you need to obsessively pour over every financial decision you make with a notebook and pencil. Instead, tracking your spending means:

  • You account for how much money you spend every week
  • You account for how much money you earn every week or month depending on when your paydays are
  • You figure out the difference between those numbers and take action as a result
  • Where your money goes aside from regular bill payments, like your rent payment or student loan payments
  • How much money you need to make to meet your short-term and long-term goals
  • Whether you need to cut down on your frivolous spending in order to meet those goals

2. Automate Savings and Bill Payments

The next big step should be to automate your savings and bill payments. Again, most online banks have automated bill payment or savings tools these days. These allow you to automatically funnel a certain amount of each paycheck you receive toward different goals.

  • Then you don’t have to think about saving money — it happens automatically, which is easier for many Americans who struggle to save money when they could spend it on fun things in the short term
  • Your savings will grow without you having to make the good money habit decision every time

3. Avoid Credit Cards (if Possible)

From time to time, everyone has to use credit cards, whether it’s for buying an expensive item or for paying an emergency expense, like a hospital bill. However, you should try to avoid using credit cards whenever possible.

4. Budget for Big Purchases

Say that you want to buy something big and nice for your apartment or house, like a new couch or a new gaming console. In either case and more, you should budget and save up for those big purchases rather than buying them on credit or through financing.

5. Save for Retirement

Saving early on is crucial if you want to enjoy your golden years.

6. Save for an Emergency Fund

While saving for retirement is important, so is saving enough money to make an emergency fund. Emergency funds are nest eggs you can fall back on if you run into trouble and need cash fast.

7. Keep Records

Try to keep records of any significant financial transactions or decisions you make.

8. Refinance Loans as Your Credit Improves

If you have to take out a loan for any reason, consider refinancing it as your credit score improves. When you refinance a loan, you take out a new loan from a different provider (or from the same provider, in some cases) with better terms, like a better APR and no fees.

  • You’ll save money in the long-term through lower interest rates
  • You’ll save yourself money since you’ll pay fewer unnecessary fees
  • Your credit score may improve since higher-quality loans are easier to pay back

9. Keep Your Credit Usage Below 30%

As noted above, sometimes you have no choice but to use credit to pay for medical bills or other emergency expenses. If that’s the case, that’s all right! However, you should still aim to keep your total credit usage below 30% on a day-to-day basis.

10. Follow the 48-Hour Rule

Are you tempted to buy something nice you found at the store? Or did you see a sweet new car drive by and suddenly feel like replacing your beat-up used car? We all feel the temptation to buy things we don’t need from time to time.

Summary

As you can see, there’s no one way to practice financial wellness. Smart financial strategies are multifaceted, and practicing several strategies can help you save money, make the most of your current finances, and set yourself up for success in the future.

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