Consider your financial fitness as you would your physical fitness. It takes work and isn’t a one-and-done situation. Like traditional fitness, it requires consistency and hard work.
If you’re ready to get on track to improve your finances, here are a few places to begin!
Create an emergency fund
Life is unpredictable. Having an emergency fund can come in handy should you need extra funds for sudden repairs, medical expenses, etc. Having three to six months of expenses is the golden rule for emergency funds. You want to ensure you have enough saved so in a true emergency, you are still able to cover necessary monthly expenses.
Start off small and stash away a few dollars every week. Make it even easier by setting up weekly or bi-weekly automatic transfers through your online or mobile banking to your savings account. You’ll be saving without even realizing it!
Maximize your savings
Having a savings account is a great first step to becoming financially fit. Take it to the next level by pursuing additional options that will maximize your earning potential. There isn’t a one-size-fits-all solution to savings accounts. Take a moment to find the best savings option for you and how you can fatten up your savings to become more financially fit.
Being in debt, whether from a loan or excessive spending, is stressful. If you want to eliminate debt, small changes in your financial habits can make a significant difference. Use a money management tool to view all your accounts, loans, and investments in one place to see your entire financial picture. Analyze your budget to determine what you can eliminate or change to pay down your debt faster. For those with high-rate credit card debt, consider transferring your balance to a low-rate credit card and spend less on interest.
Pay credit cards in full monthly
Owning and using a credit card requires the responsibility of spending within your means. Racking up charges and continuously only paying the minimum adds up with monthly interest charges. Don’t overspend to ensure you're not carrying a balance from month to month.
Establish a system where you can still use your credit card, but “settle up” every week or so and transfer funds from your checking account to zero out the card. That way, you’re still using the card and earning points (if applicable) but always keeping track of your balance.
Start a retirement fund
Saving for your retirement doesn’t need to stop with your company’s 401k. Use a retirement calculator to estimate how much you’ll need and set a goal. Consider opening an IRA and automatically depositing funds into it to enjoy tax-deferred or tax-free savings. It’s never too early (or late) to plan for your future.
Being financially fit can help prepare you for any financial curve balls life throws. Whether you want to put more money back in your pocket, reduce debt, or find a better solution to manage your money, small steps can make a significant difference. Take advantage of everything General Electric Credit Union offers to help your finances get in shape.
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