5 tips for financial fitness

Fitness is often thought of as a purely physical thing, measured by whether you can endure vigorous exercise or exhibit muscular strength. However, financial fitness is just as crucial to your happiness as physical fitness. Achieving financial fitness better allows you to reach your goals and live the life you want.

Financial fitness isn't wealth, it's a collection of skills and the combination of knowledge and discipline you need to assess financial circumstances and make educated financial decisions. Here are our top five tips for becoming financially fit.

1. Budget. To make smart financial decisions, you need to be able to visualize and track both your income and your spending – and make decisions about how to make spending adjustments, if needed. As a general rule, try to spend no more than 50% of your net income on needs and 30% on wants so that you can set aside 20% into savings. 

2. Save. Speaking of savings, one of the best steps you can take toward financial fitness is to start saving, whether for an emergency fund to help with unexpected expenses, loss of income, education, or retirement. Work with United Community to learn about the best savings solutions for your goals – because some goals qualify for tax-advantaged savings solutions.

3. Reduce debt. Paying down high-interest debt can help you work toward greater financial freedom. Start with smaller or higher-interest debts first, or consolidate your debts into one lower-interest debt consolidation loan. Ask your Financial Service Representative how United Community can help with debt consolidation.

4. Make payments on time. Your history of on-time bill payments is the single most significant factor in your overall credit score, making it incredibly important to pay your bills on time. If you fall behind on your bills, call your lenders. They are more than likely willing to work with you. You can also monitor your credit score anytime, anywhere with Credit Sense. Login with the mobile app to get started.

5. Set goals. Perhaps the most essential tip for financial fitness is to set financial goals, with dollar amounts, goal dates, and the steps you need to take to reach them. By setting specific goals, you are more likely to put in the work to succeed. Track your progress over time and decide whether your strategies or goals need to be adjusted.

At United Community, we can help with your financial fitness. Check out our blog for more educational content to help you learn more.