1. Live beneath your means:
This is the first rule to establishing financial independence. Living by this rule will allow you to reach your financial goals faster, and with a lot less stress.
2. Pay off your credit cards:
Credit cards are usually the most expensive form of debt. Commit yourself to always paying more than the minimum required on your credit card. You’ll save incredible sums of cash by paying off credit card balances.
3. Pay yourself first:
By making yourself the first “creditor” paid, you’ll develop solid saving habits that will help you reach your long-term goals.
4. Save six months living expenses:
It’s critical to have a “rainy day” fund. For most people, six months of living expenses will provide an adequate cushion to weather most unexpected financial storms.
5. Make a will:
This is an essential step for all adults, especially those with dependents.
6. Seek wise counsel:
Don’t try to go it alone when making tough financial decisions. Consider the services of a fee-only financial planner. A top-notch financial planner can help you to establish a lifelong financial plan.
7. Fund company-sponsored savings plans to the maximum:
Through payroll deduction and often tax-deductible contributions, you can accumulate significant savings in company-sponsored plans.
8. Plan major expenditures:
If a house, new car, college education, or other large purchase is in your future, take the time to make a plan to reach your desired goal. A little planning goes a long way.
9. Educate yourself:
Read financial publications and consider taking a course on basic financial management or investing. Community colleges often offer excellent courses on personal finance topics.
10. Review progress:
Every year, list the value of what you own and what you owe. The difference between the two numbers is your financial net worth. Save this list, date it, and compare it to your current year’s progress. You’ll be amazed at how much difference a year makes in your finances.
Source: Wellness Councils of America 9802 Nicholas St., Suite 315, Omaha, NE 68114, www.welcoa.org