The Road to Financial Glow-Up: Why a Financial ResetMatters
Today, we’re diving into a topic that’s not just about gaining wealth but also about gaining confidence and peace of mind. Financial wellness through a financial reset can play a pivotal role in our overall glow-up journey. Now, before we dive in, let me preface by saying, I’m no financial guru. I just need a financial reset and want to share what I have learned along my journey.
Eliminate Debt First – High Interest to Low: Let’s face it – debt can be the ultimate buzzkill on our journey to financial freedom. That’s why the first step in our financial reset playbook is to tackle debt head-on. Start by prioritizing high-interest debt and work your way down to the low-interest ones. By doing so, you’ll not only save money on interest payments but also get out of debt sooner than you think. There is a caveat to this; once you are more savvy with investing, you can prioritize investing if the yields will be a higher rate than a low-interest debt to pay off, like a student loan. Also, a mortgage is a type of debt that does not need to be paid off right away. However, credit card debts with high interest should be paid off ASAP. It’s best practice to only buy what you can afford on your credit card and pay it off completely every month.
Loud Budgeting: Loud budgeting has gone viral recently, which basically means that it is ok to make intentional spending decisions that align with your values and priorities. This will mean saying no to certain things but telling people that you can’t because you are saving money – sharing with others is the loud part. Remember, a budget isn’t necessarily about restricting yourself; it’s about empowering yourself to be selective about what you truly want to spend your money on. Say no to the drink you didn’t really want or need and put that money towards a goal you have. If you share what you’re saving for with your friends, then they may help you with your budgeting goals.
Pick a Budgeting Method: There are many different methods of budgeting, but two that I want to share are the 50-30-20 method and the 50-20-20-10 method. The 50/20/30 budget rule wasmade popular by Senator Elizabeth Warren, and the rule is to split your after-tax income into three categories of spending: 50% on needs, 30% on wants, and 20% on savings. This helps to be more conscious of how much you are spending on things you want and makes sure you put away some towards savings. For the savings, it may be easiest to automatically send the 20% of your paycheck on a regular basis to a savings or brokerage account. The 50-20-20-10 method was created by Maggie Sellers, the founder of Hot Smart Rich. The 50-20-20-10 philosophy is a modification of the 50-30-20 method – 50% for needs (housing, groceries, utilities, healthinsurance, debt repayments, etc.), 20% for desires (shopping, self care, entertainment, etc.), 20% savings (investing, saving, retirement, etc.), and 10% for goals (continuing education, angel investing, side hustles, etc.). Check out her Tik Tok, @maggiesellers_ for more on this method. I love how it includes the 10% for goals. This investment in yourself can help you create opportunities to make a lot more money in the future.
High-Yield Savings Accounts (HYSA) & Emergency Savings Building: A safety net is crucial for weathering life’s unexpected storms (job changes, getting sick, etc.). Enter the High-Yield Savings Account (HYSA). Think of it as your financial parachute – ready to deploy when you need it the most. Aim to save enough to cover at least 3-6 months’ worth of living expenses in a savings account. A HYSA has a higher interest rate than standard savings accounts, so your money can grow without you having to do anything. For a single individual, 3 months of living expenses may be enough for the emergency savings, but for a family, it may be better to be more conservative and have 6 months saved away. Trust me; your future self will thank you for it.
Basics of Investing & The Mighty 401(k): Investing can be the secret sauce to growing your wealth over time. But it doesn’t have to be rocket science. Start by dipping your toes into the basics of investing – think ETFs and index funds, which are a collection of stocks. As you get more into investing, you can invest in individual stocks, but that should involve some financial analysis for each one. And don’t forget about the power of the 401(k) – your ticket to tax-advantaged retirement savings. If you have an employer match, maximize it – can’t say no to free money!
And there you have it – a crash course in the importance of a financial reset for your glow-up journey. Remember, building financial wellness can take time, so take it one step at a time, stay curious, and never hesitate to seek guidance from trusted financial experts along the way. Here’s to a brighter, wealthier future ahead! ✨💰
Disclaimer: I may earn commission from the Amazon links posted in this blog.
The Global Currency Reset (GCR) typically refers to a hypothetical event in which the world's currencies are supposedly “reset”. The GCR looks at new values based on the revaluation of specific currencies and the devaluation of others.
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The objectives of the financial system are to lower transaction costs, reduce risk, and provide liquidity. The main financial system components include financial institutions, financial services, financial markets, and financial instruments.
Introduction: My name is Van Hayes, I am a thankful, friendly, smiling, calm, powerful, fine, enthusiastic person who loves writing and wants to share my knowledge and understanding with you.
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