Whether you recently made a New Year’s resolution to bank more cash or chose to spend wiser and invest smarter simply out of necessity, there’s no better time than the present to consider learning how to successfully manage your financial expenses.
“Financial wellness is a key part of an overall well-balanced life,” says Beth Blecker, a financial adviser in Nanuet, New York. “Financial wellness is a peace of mind. It means not lying awake at night wondering how the bills are going to be paid. It means that a comfortable retirement and the children’s tuition or weddings are just a matter of time.”
Everyone and their families can benefit from financial stability, Blecker says. But financial stability is not the end in itself. It is a means to accomplish greater things, like helping to send your kids to college or donate to a charity.
“It is an ongoing process that needs to be monitored to be sure goals are on track to be met,” she says.
Financial wellness is the practice of creating regular and healthy habits with your money, says Aditi Shekar of the San Francisco Bay Area, founder and CEO of Zeta, an online tool that helps couples master their personal finances.
“Similar to health care, financial care involves getting a better understanding of your finances, creating a plan for how your money can help you achieve your goals, and gaining control over your finances,” she says. “Financial wellness covers strategies on how to manage your cash flow, navigate debt and build a savings plan towards your short, medium and long-term goals.”
Shekar says it’s important for people to have financial wellness because finances are a leading cause of stress in people’s lives.
“Without adequate financial support, people often feel overwhelmed, stressed and even fearful about their future,” she says. “In fact, your financial wellness can affect your family life, your productivity at work and even your friendships. Building strong money muscles equips people with the ability to take control of their finances and work towards a happier and healthier life.”
Flex your finance muscles
David Bakke, a financial expert and writer for Money Crashers, headquartered in Henderson, Nevada, says people can improve their financial wellness by first getting on a budget.
“Next, reduce your monthly expenses as much as possible through internet research,” he says. “There are plenty of ways to save on groceries, gas, utilities and more. Then, you should see a surplus in your bank account, and that money can be used to achieve your long-term goals like getting out of credit card debt, saving for retirement, and having a fully stocked emergency fund.”
During this time, keep discretionary spending to a minimum until you’re well on your way, Bakke says. “When you have that surplus, go ahead and add your long-term savings goals to your budget so you remember to save for them each month,” he says.
Shekar adds that it’s key to know where your money is going, and you can use any of the many budgeting apps to help you understand how much money is coming in (being earned) or going out (being spent). Also, focus on your goals, get help where you need it, and get your friends and family involved.
“Money habits are often established early in a child’s life and play a significant role in your relationships. Turn to your friends and family as accountability partners so you can each drive towards progress together,” she says. “Financial wellness starts with an attitude — you have to want to build your money muscles.”