We do so much in the name of fitness: exercise, diet, even therapy. But what about our financial fitness? Financial well-being is an important part of living healthy. Not sure where to start? Read on!
By Jim Chapman, managing director, Wells Fargo Institutional Retirement and Trust
Getting in shape is tough, especially when it comes to finances. In a recent Wells Fargo study, Houston adults said that the hardest parts to getting financially fit are knowing the best approach (41%) and sticking to the plan (32%). The following tips provide a roadmap for getting started and staying on the right track to improve your financial health.
6 Tips to Financial Fitness
- Know your goal — Create a financial plan by determining, setting and following your goals. Talk to your banker or financial advisor about how to create one, or check out wellsfargo.com for advice.
- Budget Your Money — Create a budget of your monthly income and expenses and stick to it. Speak to your banker or check your bank’s website for advice and tools about how to track spending and monitor your progress toward your savings goals.
- Review Expenses — Review your expenses monthly and reduce unnecessary ones. Repeat the process monthly and cut back where you can.
- Start Saving — No matter your age, now is the time to start saving for your retirement. Take advantage of any retirement savings plan your employer offers. Many employers offer a match—if you don’t contribute, you are essentially leaving free money on the table. 401(k), 403(b), or 457 plans are simple and convenient. The money is automatically withdrawn from your paycheck, allowing you to save, not spend.
- Understand Credit — Whether you’re considering purchasing a home or a new car, ask your banker about what lenders look for when reviewing a loan application (“the 5 C’s of credit”). Find out how to improve your credit score to increase your chances of borrowing money at an affordable interest rate.
- Pay Down Debt — Have credit card debt? Always pay at least your minimum monthly payment. By paying more than the minimum—or, better yet, the full balance each month, you will reduce the finance charges you may incur. Be sure not to skip any payments.
Ready to Start?
Visit the Wells Fargo Retirement Plan Website for more tools to help you plan for retirement and to learn more about strategies for saving for college, creating a spending and savings plan, paying down debt, and more.
