Broker Check
Do you know your financial health?

Do you know your financial health?

January 27, 2022

Today, let’s chat about health… health of your finances that is.

Most medical insurance plans cover a wellness exam each year for their policyholders. The goal, of course, is to maintain wellness and stop possible health problems before they occur. Instead of waiting until you have a health issue, problems can be caught in the early stages and hopefully easily remedied. The same is true for your finances.

A regular financial check-up can assess your ‘financial fitness’ and screen for potential problems that will prevent you from meeting your goals. It’s also a good time to review those goals and make sure that your plan is still in line with your current situation. Life is a journey that is seldom lived in a straight line. Twists in the road can change your goals and your plan sometimes needs to be adjusted to stay on track.

Some things that will help keep your finances healthy:

- Have a budget in place. Knowing what your income and expenses are, is key to creating a roadmap for how to get to your goals. (See our previous post for more info about budgets and a link to some free budgeting tools)

- Have an emergency fund set aside. There is no one-size-fits-all recommendation for an emergency fund. The amount will vary depending on your fixed expenses, family size, how employable your skills are, etc. Make sure you have enough set aside to help you stay in control if the unexpected happens.

- Keep your debt-to-income (DTI) ratio low. This is an important factor of your overall financial health, comparing how much you owe each month to how much you earn. The lower your DTI, the healthier your finances are.

- Have a plan mapped out. No one can anticipate every twist and turn life can take, but if you have a roadmap for your financial journey, it’s easier to adjust for any detours and side-trips along the way… and avoid ending up miles from your intended destination.

 - And don’t forget to check your credit report regularly for errors or indicators of identity theft.

How often should you do a financial check-up? We recommend twice a year, to keep you on course and avoid potential problems. As you approach the age of 50, this is even more important to make sure you stay on track for your retirement.

As always, we’re here to help! If you have any questions or are interested in having a retirement analysis done, give us a call or contact us HERE