Money Mindfulness: Practicing Financial Self-Care
Most self-care messaging reminds us to nurture our physical and mental well-being with mindfulness practices, exercise routines, and virtual detoxing. But what about financial self-care?
When we cultivate positive money habits and plan for our future we are (quite literally) investing in ourselves. Financial self-care is rooted in self-awareness, discipline and intentionality. Here are several ways you can practice financial self-care, starting now.
Build a Budget
Building a budget is like giving yourself the gift of clarity: it allows you to track expenses, identify potential areas where you can trim spending, and allocate funds to help you achieve financial goals. Rather than seeing budgeting as a restrictive practice, look at it as a tool that grants you freedom to spend where it matters. Connect with your financial institution to see what budgeting tools they offer.
Create an Emergency Fund
More than half of Americans fear they wouldn’t be able to cover daily living expenses for a month if they lost their income tomorrow, according to a recent Bankrate survey. Invest in your future peace of mind: set up an recurring direct savings deposit (which you can do in CCU’s Online Banking) with the goal of setting three to six months' worth of living expenses aside. If you’re living paycheck to paycheck, you can start small by setting aside 2% of your net income and gradually increasing your contribution rate when possible.
With recent federal interest rate hikes, borrowing costs have reached historic highs, which means even your debt is costing you more money. Taking proactive steps towards debt reduction can improve your financial health and significantly reduce your stress. Tools like credit cards with interest-free balance transfers can help. Unsure of what else to do? Explore a Debt Management Program, designed to pay off your debt in 3-5 years.
Plan for Retirement
If your employer offers a 401(k) retirement plan, take advantage of this benefit (especially if your company matches part or all of your contribution). Don’t have a workplace retirement account? You can open a Roth IRA—a tax-advantaged retirement savings account. If you find it challenging to save throughout the year, consider setting aside part or all of your tax refund as a way to begin investing without impacting your day-to-day budget. High rates also mean high earning potential, such as Certificates.
One of the most empowering aspects of financial self-care is education. Chat with CCU at 877.275.2228 about what resources they offer. If you want to explore courses and are worried about costs, take advantage of the financial education to be found at GreenPath Financial Wellness. Whether you’re preparing to buy a home or navigating your auto loan, these sessions offer jargon-free, shame-free guidance to help you reach your financial goals.
This article is shared by our partners at GreenPath Financial Wellness, a trusted national non-profit.