Life Times Newsletter

Summer 2011
Vol. 13, No.


How to improve financial health



Michael Ravenscraft, MS, CPA
Financial Education Specialist

This summer, many of us may be
enjoying a change of pace to our regular routine. Summer often gives us a chance to renew ourselves,
giving us a fresh outlook when fall arrives.  Often we are more conscious of our physical health in the summer.
     In much the same way, we can use summertime to focus more on our financial health to determine where our family money is going and why. As we emerge from one of the
deepest recessions in recent history, many of us have a greater appreciation for the value of a dollar.  We may realize we can do without some things we thought we needed as we better distinguish between our
needs and wants.
Here are some steps  to making powerful positive change in our financial lives by looking at what weíre doing rightóand what we can improve.

1. Gather information, and then write it down!  When people make a decision to improve their physical health, one of the first things they do is to get on the scale.  Why? Because they need to know what they currently weigh. Regarding our finances, we also need to know where we stand in our financial lives.

2.  Determine what you own.  Make a list of assets, like bank accounts and investments, along with other items you own.

3.   Write down what you owe and to whom.  This is the starting point, where you are today.

4.   Keep track of what you make, what you spend, and where you spend it.  More detail is better.  This is your current budget.  We all have one; itís just informal.  An accurate record of what weíre doing is a very powerful tool, so keep track!

     Now youíre armed with the information to make decisions. Your current budget is like your calorie count.  Take a hard look and decide if everything in your spending habits belongs in your long-term plan. 
     Are you taking on extra debt each month? Is enough going into savings?  Do you have a rainy day fund?  Do you have a current plan for retirement?  From where will the money come? 
     Itís much easier to make these long-term decisions when youíre armed with information about what your resources are and how youíre using them.  These spending decisions, even if itís just a few dollars a day, can have an enormous impact on your long-term wealth and financial security. 
     Nobody thinks counting calories is fun or exciting. Yet after weeks and months of keeping track, you love the way you look and feel!
     The same concept applies to your money. At first itís tough to give up those extras in your budget, but then you see your savings going up, and it feels pretty good!  So start keeping track, building wealth, and in the long run, youíll love the way you feel!




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University of Missouri Extension Editor: Roxanne T. Miller