Let's talk money.


Are you a financial warrior? They are among us. The people who are all about checks and balances and simply making strides to attain new life goals and creating the financial situation to make it happen. How would you rate your current financial situation? Do you feel like you’re doing the bare minimum and just getting by; doing enough of the good stuff to still get enjoyment from a median lifestyle or are you being intentional and bold with your financial choices to create the exact lifestyle you want? Maybe your perception is realistic and maybe it can be validated or readjusted. Read on to see what are some of the top things you need in your arsenal to claim your spot as a financial warrior.

You Have Financial Goals: In order to move the needle forward, you have to have a vision for exactly what you want. This is where you need to start. Do you have life goals and, more specifically, goals for what you want your money to achieve for you? To make things happen in your financial life, you must develop your smart goals. When you have a clear goal in mind, you are more likely to make financial decisions that will help you stick to it. Do your best to make our goals as real as you can. You want to be able to answer questions like when do I plan to achieve this goal? What will it look like to achieve this? How will I feel when I achieve it? Who is there with me? The more detailed the better.

You Have A Budget: This is essential! A budget sets the stage for what you’ll build upon to get to your goals. Having a budget signals that you have an understanding of your net worth (Assets minus debts/expenses) and have made efforts to allocate money in the appropriate funds (saving, essentials and discretionary) in order to make it towards your goals. A budget can be as fancy or simple as you need it to be and there are apps out there that can help with the process where all you have to do is set your goals and input accurate figures about your current spending and income. This is the time to be realistic about what money is going out so you can have a rational revelation about if you want to keep current spending habits at the expense of slowing down your goal attainment or if you will identify the areas where you can shift your money outflow to support with getting to your financial goals faster.

You Have An Emergency Fund: Are you prepared for a minor emergency? A 2017 Bank rate survey suggests that 63% of Americans cannot handle a financial emergency. When you have an emergency fund, it shows that you are liquid (have available cash) and has the flexibility to work with cash that isn’t exclusively reserved for fixed (monthly) bills. A rule of thumb is to aim to save enough cash to cover 3-6 month’s worth of your fixed expenses. You can continue to build upon it beyond the 3-6 month point, and remember to replenish it f an emergency arises, but if you get to the point where you can exceed the 3-6 month worth of expenses and still are able to take care of your basic necessities, consider the next thing on our list, investing.

You Are Investing: If you are able to establish an emergency fund, having an investment account of some sort should be a priority. Saving for your short and long term goals deserves a process that can grow your money, exceptionally, even when you’re not watching it. Savings accounts through your bank are great for short term goals and quick access, but if you have retirement goals, home buying goals and other things that will make a bigger financial toll, investing is the way to go. The interest rate is good and you get compound interest the longer you keep your money with the market. If you’re not doing an investing on your own like have an individual retirement arrangement, make sure you're contributing to an employer 401k program if available; if there’s an employer match, make sure to contribute up to that amount. Another financial warrior move related to retirement accounts is maxing out your eligible retirement contributions for the year. By doing so, you’ll receive a tax break at tax time. The more diversified you are with your investments, the better.

You Have A Financial Advisor: Just as you would call on your doctor for physical health, an advisor will take a look at your financial health and make recommendations as new things in your life arise. Consider it a level of quality control helping to make sure that everything you are doing is helping your end goal. As a reminder, you may consider working with an RIA (Registered Investment Advisor) who is bound by the fiduciary law to work in the best interest of their client. An RIA can help you with the investing portion or help you at the very beginning with sorting out your financial goals and helping cultivate a financial plan for success.

So, how did you score? If you have done all of these things, congratulations! Consider yourself a financial warrior. Involving these activities in your financial plan will create financial freedom and flexibility to achieve your goals as planned. If you didn’t check off as many of the things above as you’d like, the time to take steps to improve is now. There are a multitude of resources available to get on track, one is talking with our advisors who can provide a comprehensive plan for your goal achievement. When you’re ready, consider talking to our advisors at InvestEd. Our meetings are always free, confidential and judgment-free. Let us help you become the financial warrior you want to be.

Loading Conversation