Are You Prepared?
It's better to be proactive than reactive.
I was active in the Boy Scouts growing up, so that whole "be prepared" motto is pretty ingrained in me. Now, it's a philosophy our team at Family Financial Partners encourages all of our clients to live by as well. Whether it's something simple like keeping good flea prevention on hand for my Great Dane or something a little more complex, like saving up ten grand in an emergency fund, these are things I - and my clients - are always glad we've done before we need them. No one wants to battle fleas in the carpet, right?
For many of my younger clients, this is the time in life when good decisions and habits can be formed more easily, as the decisions made now will have effects for years to come. Time is on your side, so take advantage.
Here's my list of the best preventive measures you can take now:
1. Get rid of the "I'll do it later" mindset. I admit, even I'm guilty of this when it comes to my personal finances, as things can get busy, or know I have an expense coming up, so I hold off on saving. The truth is, unless you go ahead and just do it, you likely won't. Sometimes jumping right into goals or areas where you don't feel comfortable can be exciting. So go ahead, start contributing more to your 401(k) like you planned, and stash away that emergency fund. Even if you're not sure whether you're doing it "right" or not, starting now is better than not starting at all.
2. Even if you qualify for deferred student loan payments, pay something now. Pay off some interest to keep it from ballooning - you can also get a tax deduction if you are paying the interest. This deduction could allow you to put away some extra savings after tax time. If you're not paying on your loans and can't get that deduction, you're simply giving extra money to the government, or spending it on stuff you probably don't need.
3. Establish good habits - and stick with them. Whether it's saving a bit of each paycheck, having a routine at your job to work more efficiently, or increasing your 401(k) contributions each year, put those habits in place and don't even think about them. Routines can help ensure you don't forget about things that could affect your finances or your job performance. So establish simple routines at first, make them habit, and then add more as you become comfortable.
4. Take good care of yourself. Today. Eat well, and exercise. Why am I mentioning this in a financial newsletter? A couple reasons. First, if you're eating healthy and avoiding most junk food, chances are you aren't eating out most nights, or buying packaged foods, and therefore you're saving money. Further, you're also likely saving on your own healthcare expenses down the line, by not falling into unhealthy patterns. Health insurance and life insurance premiums will likely be lower for you, and you'll probably have fewer overall health issues to deal with and pay for. Health care is a huge expense these days for just about everyone's budget, and the more you take care of yourself now, the less likely you'll have large maintenance expenses down the line. Make it a goal for yourself, as a way to not only improve quality of life, but your pocketbook too.
What steps are you taking today to help make your future more secure - and healthier? We'd love to hear about it. Need a little help establishing habits and routines to prepare you for the road ahead? Give us a call. We're always happy to help.