Your Financial Wellness is Just Like Your Physical Well-being

Your financial wellness is just like is your health. You know that it is your responsibility to stay as healthy as possible, and it requires you to be physically active. You care for your health and wellness by exercising, maintaining a healthy diet and equipping yourself with knowledge of how to take better care of yourself.

Likewise, your financial wellness requires your active participation. You need economic discipline to cultivate and maintain healthy habits to keep to your investment plans and work towards your wealth accumulation goals.

The journey towards financial freedom is tough and requires that you switch off from your daily chores and spend some time to review your current position and come up with a roadmap to your financial destination.

Where is your Starting Point?

You cannot know where you are heading unless you know where you are! You must, therefore, bring yourself to understand your current financial position. If you can list your monthly income and expenditure, then you have already found your current location.

So, what is the difference between your income and expenditure, in other words, your net income? If it is a negative value, then your financial health is severe and it needs to be taken to an “economic intensive care unit” to reverse the situation.

To heal your ailing financial status, you need to cut down on unnecessary expenses. Have a leaner budget and survive with less. Only if you are able to set aside some money each month can you start a wealth accumulation plan.

Where is your Destination?

Once you know your position and are ready to take off, the next step is to identify your financial destination. What are your financial objectives? What are you looking to achieve and what is time frame? It is at this point in financial therapy that you create your goals, both long and short-term. For example, in the long term, you may be dreaming of owning a home, whether through a mortgage or other available arrangements in the Singapore property market.

Offload the Unnecessary Baggage

Reduce the load that may drag you down on your way to financial independence. Such baggage may include high interest charges on loans and credit facilities. Reducing them leaves you with more disposable income that, with time, would yield tangible results. You need every cent in this journey, and hence, should not tolerate wastage.

The Reserve Fund is your Energy Drink

As mentioned earlier, the path to financial wellness is long and tedious. Therefore, you need an energy drink for any emergency. Remember, you have already reconfigured your finances and they are now in shape. You have laid down a plan to success and what remains is putting it into action. At this point, you do not want an unplanned event that may require you to incur an unexpected expense to ruin your plans.

However, we are not able to control some situations. Thus, you need cash savings that are easy to access as your contingency plan. For example, when you have an uninsured medical treatment, you can resolve the problem by using your cash savings, and this will not interfere with your investment plan. Experts recommend that your emergency savings should be at least six times your monthly expenses.

Bottom Line

You will not achieve financial wellness overnight! You must be realistic and set the right priorities that will work for you. And remember, your plan is not cast in stone; it will change according to the economic situation and your different life stages. The bottom line is, once you take control of your finances, you need to actively participate and keep it on the path towards your goals.

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