With a little help (and a little goal setting), future financial security is within your grasp
What can you do today to be financially healthy for years to come? More than you might think.
Finances often sit at the bottom of the to-do list. But like any aspect of your life, there are plenty of money habits that are easy to adopt and will benefit you later.
To get the ball rolling, here are six goals to support your financial health, regardless of your financial literacy or current situation.
1. Create a budget (and stick to it!)
It may not be the most thrilling task, but creating a budget is an important step in understanding how you’re spending your money and where you could create some savings.
You’ll want to include any income, as well as debt, in addition to your ideal budget for various life-spending categories. Then, track your expenses for at least a month to see whether your expectations are realistic. Once you have a good grasp on your spending habits, you can tailor your budget, create savings plans and set consistent dates to review and update your goals.
2. Set up a meeting with a financial planner
One of the goals on everyone’s list should be to meet with a financial planner. Why? Because finances are complicated, and for many people, more than a little bit daunting. Financial planners can answer your questions and help you map out your wealth-management strategy.
To start, seek out a reputable credit union like Prospera. This co-operative has served B.C. for 75 years, and actively works with 64,000 members in the Lower Mainland, the Fraser Valley and the Okanagan. They provide a wide range of wealth management and investment services and can offer expert advice to bring clarity to your financial plan.
3. Save a little every month
Twenty-four percent of Canadians say they’re living paycheque to paycheque with hardly any money set aside. Don’t be the 24 percent; put some income away until you have at least three months' worth of living costs. Anything additional can go towards something that you enjoy, such as travel.
Regardless of what you want to achieve, there’s a way to plan for it. Jeff Olensky, Wealth Management Specialist at Prospera, stresses that “it’s not just about numbers and statistics—it’s about you.” Whether you want to “retire at 60, golf three days a week or you want to get an RV and travel,” Olensky says you can make that a reality by setting aside a little money each month.
4. Consolidate (and eliminate) your debts
Moving your debts—particularly the high-interest ones—into one consolidated space is one of the most straightforward ways to simplify and streamline your financial plan. You’ll have a better grasp of how much you actually owe and can focus your repayment efforts on a single area.
In an ideal world, you’d only spend what you can immediately pay off. But since that’s often not the case, you may as well start paying down that balance. There are two schools of thought for eliminating debt: first, pay off highest interest debts first to remove the largest drain on your income; and second, employ the snowball method and pay off your smallest debts first to help give you the motivation to tackle the bigger, scarier ones.
5. Create a retirement road map
Regardless of what you do for a living, creating a plan for retirement is an important step towards long-term financial health. Make sure to talk to your advisor for this one, as there are various options available to you including mutual funds, term deposits and online investing.
The right advisor will take time to develop a thorough understanding of your circumstances as well as your financial and life goals. They’ll then develop a personalized retirement plan to meet your financial needs.
6. Invest mindfully
If you haven’t already delved into the world of investing, now’s the time. We’re living in an age where you can invest in companies online, get into real estate without purchasing a property and easily access trading platforms. Though learning about investing can be like learning a whole new language, improving your financial literacy in this area can benefit you more than you’d expect down the road.
Whether you’re just finishing your master’s, expecting a baby, retiring or anything in between, there are several tried-and-true options to make the most of your money and prepare for your future. Take the first step today by setting up a meeting with a financial advisor to learn more about how you can plan (and achieve) your goals.