7 Steps to Stay Financially Fit

Managing your financial health is one of the best things you can do for yourself for both short- and long-term prosperity. However, staying financially fit is often easier said than done. To help you along the way, consider these seven tips—

Define Your Goals

Before you try to create a budget, start a retirement plan, or open an investment account, the first thing that you should do is define your goals. Goals can range in scope and might include things like:

• Having enough money to buy a house in five years’ time
• Being able to pay for a wedding
• Funding your child’s college education
• Having enough money to retire at a desired age

The more specific your goals, the better. Try creating SMART goals if you’re feeling really ambitious! 

Inventory Your Assets

The next thing that you should do is take stock of your assets, which includes any property you own (i.e. car and house), money in your bank account, and any investments that you have. Do you know your current net worth? What is your monthly income? 

Familiarize Yourself with Your Debts

One of the most important—and most challenging—things that you need to do when on the journey to financial fitness is to get real about your debts. In addition to any credit card debt you have, what other debts are you facing? These might include student loan payments, car payments, mortgage payments, etc. 

Set a Budget

Once you’ve defined your goals and taken a good hard look at your income and liabilities, now you can start to set a budget. Your budget should first address the non-negotiable expenditures you face each month, like rent and groceries. Then, set aside as much of your income as you can afford to save—the goal is 10-20 percent of your income. Finally, leftover money can go to the things that you want, but don’t necessarily need. 

Learn About Investing

Have you been saving your money in your bank’s savings account, or are you investing your money into a tax-advantaged account? If you’re saving for retirement—which you should be—then a retirement savings account is strongly recommended. Talk to a financial professional to learn more about the benefits of investing. 

Check Your Credit

Knowing your credit score is an important benchmark that can help you to make smart credit decisions and help you to understand how well-positioned you may be when seeking a loan. If you’re struggling with a low credit score, focus on paying off any outstanding debts ASAP. 

Create a Financial Plan

A full financial plan is more than just a budget—it includes a plan related to insurance, retirement, private wealth strategies, and more. At Harvest Wealth Partners our financial professionals can help you to pursue your financial goals. Reach out to us today by phone or online to get started.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. To determine which strategies or investments may be suitable for you, consult the appropriate qualified professional prior to making a decision.

Contributions to a traditional 401(k) may be tax deductible in the contribution year, with current income tax due at withdrawal.  Withdrawals prior to age 59 ½ may result in a 10% IRS penalty tax in addition to current income tax.

A Roth 401(k) offers tax deferral on any earnings in the account. Qualified withdrawals of earnings from the account are tax-free. Withdrawals of earnings prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax.

This material was prepared for Harvest Wealth Partners financial advisor’s use.