If you’re not concerned about taking care of your financial health yet, you should be. Paying attention to your financial health early on is imperative if you’re going to have savings, investments, and things that will provide you with a happy, healthy, carefree future.
It doesn’t matter how young you think you are, you’re never too young to begin taking care of your financial health. Here’s what you need to know so you can get to work on it ASAP:
Step one: Assess Your Finances
The first thing you need to do is assess your finances. How much are you earning and spending? How much are you spending on bills? What are your habits like right now and how can you improve? Being honest with yourself is key to getting the ball rolling. Your bank can sometimes provide you with insights, or you can use an app to track your spending and see what’s going on.
Step two: Save An Emergency Fund
Saving an emergency fund should be the first thing you do, if you haven’t done this already. This usually includes 6-12 months of living expenses to cover emergencies. If you want help with this, you can look at reviews by the Motley Fool to get an idea of who to save with and the best banks. An emergency fund will give you peace of mind in the future, whether your job is on the line or you need a new car.
Step three: Look At Your Retirement Savings/Pension
How does your retirement savings/pension look? The sooner you start putting money into this, the better. Your future self will thank you.
Step four: Pay Off Your Debt
Paying off your debts is key if you want more money to put into savings/investments. You don’t want it all to be going on interest. Find a method of paying off your debt that suits you, whether that’s paying off the smaller debts first to gain momentum, or paying off the larger ones to reduce interest.
Step five: Start Investing As Soon As You Can
As soon as you can, start investing. It doesn’t matter if you know nothing about it, you should be doing it. There are free resources that can teach you all about it online, and even apps you can use to make investments for you.
Step six: Perform Experiments To See if You Can Improve Your Cash Flow
There are going to be many ways you can improve your cash flow without swapping much of your time. Here are some suggestions:
- Start a vlog and monetize your videos.
- Look at affiliate marketing.
- Try dropshipping.
- Write an ebook.
- Create a course.
- Rent out a spare room in your home or your driveway.
- Advertise a company on your car.
Step seven: Develop A Better Relationship With Money
While you’re doing all of the above, make sure you’re also working on developing a better relationship with money. The relationship you have with money can affect how you earn it and use it, so make it a positive one!