August 13, 2021

5 Tips to Get the Most Out of Financial Awareness Day

Every year on August 14th, we celebrate National Financial Awareness Day. This holiday serves as a reminder to brush up on your finances and work towards achieving financial stability. The financial world is constantly changing, so it’s important to make sure you are aware of any news and change any habits that may affect your financial planning and goals.  

Here are some tips and tricks to better manage your money and celebrate National Financial Awareness Day:  

1. Review Your Savings and Budget  

Before any important financial decisions can be made, one must first be aware of your financial status. You may have a checking and saving account, retirement plan, and/or investment portfolio, but do you know exactly what those look like? To start gaining an understanding of your financial situation, consider checking in and asking yourself:  

  • How much money is in each account?  
  • What are my expenses? 
  • Are there certain investments that are under- or over-performing? 
  • What are my financial goals? How can I achieve these goals?  

After asking these questions, you may find that you are looking to save more or invest more, but where should you start?   

Consider creating an excel spreadsheet to help with budgeting. For example, create a column of all of your expenses- rent, utilities, groceries, clothes, etc. and have the last column add them all up. Or, if spreadsheets are not your forte, there’s an app for that. There’s plenty of financial planning apps available to download on your phone- from those that track and categorize your spending to those that help you invest your spare change. Whether you create a spreadsheet, download an app, or track your budget otherwise- this will give you a number to work with and  help you see where you may be overspending vs. where you can be more flexible.  

2. Invest in Your Future  

Many people are hesitant to start investing. Possibly because they do not feel like they are knowledgeable enough about what to invest in or don’t think they have the time or money. However, you can’t win the game if you’re not in it. There are plenty of options to invest in- such as your standard stocks, bonds, and mutual funds. But, one can also invest in alternative assets that they may understand more, such as real estate, startup company, or cryptocurrency.  

Spare buying takeout one night or at least consider picking the food up instead of paying the delivery fee, and invest that money in an asset that you understand and have confidence in. This will start to put you on the right track.  

3. Have an Emergency Fund  

It’s something we do not like to think about, but emergencies do happen and it is important to be prepared. Start by setting yourself a measurable and attainable goal. For example, if you are looking to start with $500 in your emergency fund, try saving $10 a week for a year. If you stick with the plan, you’ll end up ahead of the curve and actually save $520!  

If you are looking to be even more organized, consider opening a separate account for your emergency savings. This way, it will be out of sight and mind until it is needed. A Roth IRA can serve as an emergency savings account, since you can access your Roth IRA contributions at any time and for any reason. (However, only contributions can be taken out tax-free, and earnings cannot be accessed until you are over 59 ½ years old and your account has been open for 5 years). As a bonus, if you end up not using the emergency funds in the long-run, you are growing your retirement savings in the meantime.  

4. Get a Head Start on Your Taxes   

Although tax season may seem far away, it is never too early to prepare. Consider getting all of your documents together - receipts, expense records, donations, etc. - in an organized folder so when the tax deadline rolls around you won’t be dreading it and can use that extra time for other priorities.   

5. Increase your Financial Literacy  

There are plenty of ways to increase your financial knowledge, here’s a list of a few:   

  • Join an investing club  
  • Read a personal finance book or blog 
  • Subscribe to financial newsletters to get news right to your inbox 
  • Listen to a financial podcast while driving to work or cleaning the house 
  • Follow financial experts on Social Media  
  • Speak with a financial advisor 

There are just a few ways to celebrate National Financial Awareness Day, as there are many ways to improve your financial knowledge. Any step taken towards becoming financially aware is a step in the right direction. Start today and become confident in your financial decisions, by scheduling a call with one of our in-house experts.

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