August is National Wellness Month, otherwise known as the yearly opportunity to reflect on healthy habits and make self-care a priority. So, to celebrate, here are six ways to work toward financial wellness over the next few weeks.
Having some debt to your name isn’t a bad thing. Most homeowners have debt, in the form of a mortgage, as do many recent grads and car owners. However, if you’re struggling to pay off high interest debt from credit cards or predatory loan—it’s time to develop a strategy. Consider refinancing to get a better interest rate, or look into transferring your balance to a 0% APR credit card so you can pay it off without earning more interest.
Financial wellness requires financial knowledge—and that’s where budgeting comes in. At it’s heart, budgeting is simply knowing what money is coming in and what money is going out. With a budget, you can start to understand how much you’re actually spending in any given month and take steps to spent less, save more, and invest for the future. Head to the Harvard FCU blog for frequent budgeting tips, or check out an app like EveryDollar or You Need A Budget (YNAB) to get started.
If your current financial goal is to simply have more money at the end of the month…it’s time to think bigger! Setting a larger, longer-term financial goal can encourage you to spend less, save more and stay on budget. For some people, that goal might be to buy a house. Education, travel, or funding a special event are other popular goals. Write down your goal, estimate the cost, then map out how budgeting and saving can get you closer.
Your credit score plays a big role in your overall financial health. The higher your score, the easier it will be to get approved for a loan or credit card with the best interest rates, terms and rewards. Credit scores can even have an impact on your ability to get hired or rent an apartment. Don’t know your credit score? If you’re a Harvard FCU member, you get free access to your real-time credit score, plus an in-depth credit report and personalized financial tips, through Savvy Money.
From credit cards to bank accounts to loan refinancing, it pays (big time!) to know what financial products and services are available. Even if you’ve been with the same credit union or bank for many years, it’s easy to lose track of what’s on offer. Check in with your financial institution about refinancing loans, which might be able to help you pay off loans more efficiently or at a lower interest rate. Ask about rewards credit cards, to earn cash back or travel points. And, make sure you’re getting the best rate on your check on savings account.
Financial wellness today can look very different from financial wellness twenty, thirty or forty years in the future. That’s why it’s so important to make future planning a part of your financial wellness strategy at any age. Opening an Individual Retirement Account (IRA) and making the maximum contribution yearly is a great place to start. You can also look into estate planning tools in order to understand more about how to protect your finances and loved ones through wills, trusts, asset plans and so on.