Beyond The Basics: Stepping Up Your Financial Game

Read the Article

Save more, spend smarter, and make your money go further

You’ve graduated from the basics and plan to up the ante. Now it’s time to start stepping up your financial game. So, what’s next? The budget and spending plans are in place, your savings look pretty good and you’re ready to take on a new set of goals. You’ve worked hard to maintain a strong credit score and retirement goals seem to be on track. What are some ways that can show you’ve moved on to the big league within finance? Whether you’re ready to take the leap or looking ahead to find some inspiration – mix and match these jewels to achieve platinum status in your finances.

Increase your purchasing power

This is the process none of us particularly care for, but it’s always necessary. Think about some of your most recent purchases. Were they planned for or was it quite the opposite? Try your best to avoid any impulsive spending. If this can serve as a hiccup for you, adopt the cash method. Each week, withdraw a designated amount of cash for entertainment, food or any other category that may trick you into swiping more than usual. Once the cash is gone, so should your desire to spend. Achieving a new level of discipline is important for your personal development, but also vital in rising through the ranks in the world of finance.

Maybe your pain point isn’t impulsivity, it could be buying items or groceries in bulk only for them to end up going to waste. Even if you’re shopping for a large family, it’s important to assess what is used on a weekly basis. Before going on that grocery run, take a look and see what’s in the kitchen to avoid duplication. If leftovers aren’t a household favorite, avoid making large meals. The key to increasing your purchasing power isn’t to necessarily eliminate spending, it’s observing everyday habits and improving small but impactful decisions.

Stick to your plan to reduce debt (and keep it away)

There are usually three types of people as it relates to debt:

  1. Those who have no debt whatsoever
  2. Those who have and are comfortable with minimal or moderate debt
  3. Those who have so much debt they can’t imagine life without it

If number three is more of your sentiment, let’s start with a positive affirmation– paying off debt is achievable with focus and strategy. Does it cause frustration? Absolutely. However, reducing debt can alleviate the constant pressure many people feel to work or do more to increase income. Do yourself a favor and take small bites! Start with the lowest amount of debt to gain momentum and then tackle larger debts. If tackling debt with higher interest rates is your thing, start ranking those debts and resolving them one by one. Have patience with yourself and your finances so that the plan actually works for you – not against you.

During this process, if at all possible, avoid adding new debt. Often, this throws many plans off-kilter, forcing you to reassess and discredit your progress.

Reassess financial goals

No matter what, your financial goals can be altered, changed or re-prioritized based on current life demands. As a new goal is marked complete, there’s no harm in taking the time to evaluate what should grab your attention next financially. Plan on purchasing a home in the next year or two? Go through the much-needed exercise of reviewing your credit report to ensure accuracy. Once that’s completed, start by saving a designated amount or percentage of your income for down payment or moving expenses. If you’re going to need new furniture, take your best guess and begin a savings plan for expected expenses.

Strategy is your best friend

When stepping up your financial game you’ll want to become acquainted with shifting gears once you reach your goals to keep you consistently aligned with your money. Let’s say you’re looking to add a new bundle of joy to your family. Increasing HSA contributions to assist with medical visits, setting up a new savings account and thinking through the changes that need to happen are ways plan proactively.

Invest, invest, invest

When was the last time you logged in to see how your portfolio is making progress within your 401(k)? Does the current mix in your portfolio still align with your retirement number? If not, consider your risk tolerance. For some, this can be highly aggressive, and others may decide to assume more of a conservative approach. Rebalancing how much you choose to invest in stock, bonds and money market accounts is a healthy practice. Consult with a professional in the instance you would like clarification or more supplemental information before making any decisions. No matter what you do, don’t stop investing! When you’re really dedicated to stepping up your financial game, focus on creating continuous contributions to set a healthy boundary so you don’t have to depend on retirement money to fulfill short-term or immediate needs.

Avoid falling into old financial habits

We’ve all been there. This starts out as a very slow leak. Your spending habits increase, you’re a bit more relaxed with letting the budget slip. You find yourself dipping into savings accounts more often (and they’re not for emergencies). The credit card balances increase month over month even though you’re making payments. The familiar feelings of living paycheck to paycheck become apparent. Worry increases and feelings of uncertainty start to arise when you can’t identify how you ended up back in this exact same position again.

Don’t fall back into the cycle of financial carelessness. The level of discipline you began with when you first decided to make positive financial changes should be naturally strengthened over time. As much as we don’t like to admit, life happens to us all. None of us are exempt from experiencing hardships – especially financial ones. When certain challenges arise, take a moment to reflect on where you started, where you currently are and where you would like to be. Not only does this re-instill hope, but it can also serve as a much-needed self-pep talk to keep going the distance.

Stepping up your financial game isn’t about impressing others, it’s about better positioning yourself and your family. So in theory, the only competition you have in this financial game is the person reading this article. Being a lifelong learner, open to feedback and receptive to change will always make sure you’re on top of your financial game.

Save more, spend smarter, and make your money go further