Have you ever noticed that when you’re worrying about your finances, you aren’t sleeping well, you’re often eating poorly, and your stress level is through the roof? It’s not healthy, you’re not happy – and it feels like your life is out of your control. One of the things that I experience with our clients is the concept of downward and upward spirals. It seems that when one aspect of your life is completely out of your control, the rest of your life soon follows!
So today we’re going to focus on your financial health, and just five simple things you can do to improve your financial – and ultimately your physical health.
1. Are you tracking your expenses? Many people today have absolutely no idea how much they spend. And they don’t realize that they have been spending more than they are making until they have huge amounts of credit card debt and have no plan for how to turn it around. I’m not necessarily advocating creating a rigid budget, but if you are tracking your expenses, you know if you are potentially overspending before it gets completely out of control!
2. Are you “wasting” tons of money on something today that you won’t have use of tomorrow? Do you go out for fancy, expensive dinners? Leave the bar at night with a $100+ bar tab? Buy one or two lattes each day? Get uber everywhere you go? One of the biggest things that I hear and observe from people with financial challenges is how they spend their money on something that only lasts today. When you’re trying to watch your expenses, spend on things that will last more than just a moment. That $15 martini could be gone in less than a half hour – and will have no bearing on your life tomorrow in any way other than a potential hangover. Again, I’m not saying DON’T have any fun – I’m just saying – before you order another martini or that lobster dinner – consider whether or not this is something that will matter to you tomorrow.
3. Are you carrying a balance on a credit card? Once finances start to get out of control – people start to put their heads in the sand and just start using their credit cards, hoping that one day it will get better. My husband, Mike, is a realtor. We have times where he goes without a paycheck for a few months, and then has a couple of huge checks. It’s impossible to plan our cash flow! But we try so hard to pay our credit card bill off each and every month – even if it’s with savings. Most interest rates on credit cards are over 10 – 20% depending on your credit. I think there’s a great place for credit cards. If you have a card with rewards or miles – you can literally be earning free money and free travel if you are paying off the cards! We earn typically 2 free airline tickets each year. It makes a huge impact on our ability to travel each year – for no cost to us! But if you’re paying high interest rates, it’s canceling out the benefits. So try to pay those off each month!
4. Do you have health insurance? I know that health insurance is costly, and some people really can’t afford it, but health insurance is imperative to both your physical and financial health. I was 29 years old and had a stroke in the middle of a mall! Thank goodness for really good health insurance. It literally would have bankrupted us. If you don’t have health insurance, there is always an undercurrent of worry about what could happen. Budget a few hundred dollars a month for the physical care and the financial peace of mind that health insurance brings!
5. Do you know the interest rates on all your debt? If money is tight and you have some extra – do you know what you should pay down first? For example, if you have a car loan at 1.9% financing and a credit card at 17%, you would certainly be smart and savvy to pay off the credit card long before the car loan. Make a list of any debt you may have and identify what you will direct resources to. It will help you reduce the principal faster, and ultimately pay off the debt faster.
If you’re feeling overwhelmed and stressed out by your financial life, step back and identify if any of these things may help you shore up your financial life. I can almost guarantee that if you can improve your financial health, it will positively impact your physical health.