Defining your financial goals can be difficult, since establishing priorities depends on each person’s financial goals. Should you focus on paying your debts, saving for emergencies or contributing to your retirement savings fund? With so many financial goals, deciding what to focus on, you need to be honest with yourself and find the answers to basic questions.
Are you drowned in interest debt?
If so, eliminating your debts should be your priority, even if this means delaying other payments, or even stop contributing to your different savings funds. If you are stuck in credit card debt it’s possible to restructure it, talking directly with the bank’s representatives. Making a plan and determining which days you will make your payments can help you ensure that you can meet your goals.
Do you have adequate insurance coverage?
Insurance is an investment that few like to make, as it involves spending periodically and are only useful when something bad happens. But they can save your life. Having adequate coverage means having health insurance, property and accidents (car and housing), and disability insurance.It may be tempting to postpone obtaining insurance, but you never know when you will need it and by the time you do, it may be too late to buy it.
Do you have enough emergency savings?
Not all emergencies are covered by insurance. Ideally, you should have savings to be able to face emergencies (pay your rent and food in case of running out of income) for at least 3-6 months. These savings should be in a safe and accessible place such as a savings account or a money market fund, not some product with little liquidity (long-term investments, real estate, etc.).
Having a line of credit is an excellent way to supplement your savings method since credit can be canceled, especially if you are out of work or facing a weak economy.
Your savings and investment priorities depend on the goals you have for your personal finances, as well as your situation and particular values. Finding a financial balance depends on anything you want to achieve, and what you are willing to do to obtain it. Never lose the balance of your personal finances, join Glass and always know where your money is going.