By Kelli Kiemle, AIF®, Managing Director of Growth and Client Experience as featured in Kiplinger
Everyone has a personal definition of self-care, such as exercising regularly, getting a manicure, spending time meditating or getting together with friends — it’s the routine you do to keep yourself sane and happy. As August is Wellness Month, it’s important to not only reflect on these habits, but also your financial wellness routines.
Financial wellness can be roughly defined as being able to confidently and healthily manage your money for the short and long term. Another way to define it is to live within your means, be comfortable and knowledgeable about your financial goals for now and in the future and actively monitor your progress.
In honor of Wellness Month, I want to share the top six things you can start now that will help bring you financial peace of mind.
1. Set a budget AND review it.
Understanding where your money is going and how much you must spend monthly will set you up for financial success and give you the freedom to save and spend where you desire. This should be something that everyone in your family understands and talks about regularly. Even as young as 3 and 7, my boys know what a budget is and why we can’t purchase everything their little hearts’ desire. (Read more about how I’m teaching them about money in my article Three Ways to Teach Your Kids to Save Money.)
Learning to live within your means gives you the freedom to spend without worry, while also securing the future you desire. Finding this place of mental ease comes from regular check-ins with your budget, and there are great resources available (such as Mint) that help you track credit cards and brokerage accounts all in one place. It’s one thing to set up parameters or spending goals for each category, but it’s essentially useless if you aren’t reviewing it regularly.
Schedule an appointment with yourself to review your transactions on a weekly or monthly basis and code them to the categories in your budget. Then review this with your partner or your family so everyone is on the same page. Try this for a couple months, and it will likely make you rethink some of your spending habits or adjust how you’re handling certain expenses.
Making these check-ins part of your regular financial wellness routine is the same as practicing yoga or meditation — the longer you do it, the more benefits you will see!
2. Automate!
One of the easiest ways to create a healthy financial routine is to automate your finances as much as possible. Doing so is not only a significant time saver, but it also keeps you committed to your savings goals, regardless of what else is going on in your life. Here are some examples of where you should set up automation to save you time and money down the road:
- Have a portion of your paycheck automatically deposited into your retirement account (if you have one).
- If you are saving for your kid’s college fund, have it automatically transferred to a 529 account.
- Ensure all your bills are paid on time, such as a car payment, mortgage, insurance premiums, etc., so you don’t miss due dates and get hit with late fees.
- Automate money to be moved from your checking account to your savings account to ensure you have additional savings (more on that below!).
