Financial savviness is not something that comes as second nature to most people. In fact, effectively managing finances is just another chore on the list for many individuals. Sometimes this complete disinterest can lead to the development of bad habits though, so even if you are not into money as a hobby, try to treat your financial health as you would your physical or mental health, and care just a little bit more.
Regardless of your stage of life or income level, you will always need to spend money and always need to save it. Finding a balance between the two is tricky and depending on your personality type, you might feel discouraged by placing too much emphasis on one or the other. Below are some tips and tricks for identifying your capabilities in terms of money management as well as suggestions for learning how to develop a balance between the two so that you can live your life today while being prepared for it tomorrow.
Be Your Own Expert
Even if you hire out financial services, nobody is going to advocate for your budget as hard as you can. Having said that, be your own expert and make it a priority to know your own financial circumstances inside and out. It might not be necessary to consume yourself with the world of finance but increasing your knowledge as it pertains to your specific situation can decrease any money stress you may have and allow you some calmness regarding your finances.
Think about all the places your money is held. Do you have a checking account? 401k? Life insurance policy? Each of these locations will come with their own set of terms, fees, and fine print, be sure that you are knowledgeable on all of this. It is a beautiful thing to have a financial advisor that you can trust explicitly but do not confuse that with blind trust. Sometimes money mistakes can be made in the blink of an eye that can compromise your overall health and take much longer to remedy than you think.
IRAs for example are commonly discussed in financial circles but if you have one, do you know which kind? How about the tax implications of your chosen account? If you understand the different types of IRAs up front that can help you decide which route to take before your dump your cash into an account that might be difficult to retrieve if you discover soon after that you have made a mistake.
Know What You Need
Nobody can tell you what brings you peace in life, you must decide that for yourself. If having a plan for the future creates calm and balance in your life, then contributing to a life insurance policy might be a smart option. Someone who becomes terminally or chronically ill can sell their life insurance policy to a viatical settlement broker and receive more than the cash settlement value would be upon their death. Yes, a life insurance policy means more money from your monthly budget dedicated towards it each month but consider the payout opportunities before you rule against it.