Peace of mind with money comes when you do not have to worry about money. You take comfort knowing your bills will be covered everything month and you have sufficient investments to secure your future. Anyone can have this peace of mind about their money; it just requires a few smart moves.
- Establish an Emergency Fund – Have you ever had a surprise expense creep up on you and immediately get a headache? Well, that is the beauty of an emergency fund; it allows you to ‘plan’ for the unexpected. A good rule of thumb for an emergency fund is you should have 3-6 months of your salary in a high-interest savings account. It will take time to get your emergency fund to where it should be, so don’t lose sleep about not having 3-6 months. Create a plan and save a little every month until you reach your target.
- Invest for your Big Goals – Stop putting your savings in a Bank account. You are not getting any interest; in fact, you are losing money. Think about it like this, if inflation is approximately 8% and you are earning 2% on your savings account, then you are losing 5% of your money. So now, you know why I keep pressing the importance of investing. Investing is critical to helping you to reach those big goals, like buying a property or two, having a retirement plan, etc.☺
- Keep an Eye on Your Money – Don’t set it and forget it! No, no, no. Once you start an investment portfolio, you should check it every month, at a minimum. You need to know if you are losing or making the return you need to get you to that ultimate goal.
I can also take a little bit about tracking your expenses here. Know where your money is going. It is so easy to overspend and just swipe that card or check out online.
Then the credit card bill comes, and you’re like ‘yikes’. What did I buy? Sounds familiar? Keep an eye on your money people, only buy what you need.
- Pay Down Your Debt – Credit Card debt is one of the worst debts you can have. Why? Because the interest rate is so high and can trap you into never-ending growing debt and you end up paying back so much more than you spent. To avoid this, pay off your credit card in full every month. If you already have debt, make a plan to pay it off.
Learning about money and investing is important to create a peace of mind mindset. In the MoneySquad I share with my community the basics and skills that I have garnered over the many years, simplifying investment and teaching you how to make money work for you.