Improve Your Financial Health

Financial security takes planning and sometimes significant changes in your spending habits. If you’re finding it harder to make ends meet, here are some tips that may help.

• Set Financial Goals. Set and stick to long-, short-, and mid-range savings goals and timelines for paying off bills. Put away at least five to 10 percent of your net income each month. You should also have at least three to six months’ income in case of an emergency.
• Keep a Budget. Be realistic when setting your goals, then try to follow your budget as closely as possible. Maintain a daily diary to keep you aware of exactly where you spend.
• Economize when Possible. Cut back on home energy consumption. Shop at outlet stores or wholesale clubs. Bring your lunch to work more often. Take advantage of free or low cost activities in your community.
• Use Credit with Caution. Don’t allow credit payments to exceed 20 percent of your net income and don’t borrow from one creditor to pay another. Don’t charge more than you’re paying your creditors each month.
• Maintain a Good Credit Rating. If you can’t pay your bills on time, contact the creditor and explain the situation. Creditors will often work with you to come up with an alternate payment arrangement.
• Keep Your Family Apprised. Having financial troubles doesn’t make you a bad person. Being honest about your financial situation will help ease some of the emotional pressure. Talking to your children about financial problems that could impact them may help alleviate their fears, and encourage them to be supportive of any changes that may occur.