The rewards of taking charge of your finances are huge: security, less stress, and increased wealth, just to name a few. However, once you decide to turn your financial life around, how do you know if you’re doing it right?
The truth is that the benefits aren’t always immediate. It can be a long process that requires consistent dedication, and although you may be making gains, it might not always be obvious.
To help you measure your financial progress, ask yourself these questions:
Has your savings account increased?
A big part of becoming financially healthy is to build your savings. Without a savings account, you won’t be prepared for life’s inevitable unexpected expenses.
If you made a decision to contribute more to your savings, review your account. Have you been making deposits or transferring money on a regular basis? If you haven’t selected a consistent dollar amount to contribute, choose one that fits your budget, and set up an automatic transfer from your checking account every month.
Do you have less debt?
Debt impedes your financial progress. The money that goes towards your debt could be used for savings, personal goals, or retirement. While it might not be realistic to pay it all off as you start on your journey towards financial freedom, make sure you have a plan in place to reduce it every month.
If your debt balances are already trending down at a pace that works for you, then you’re on the right track. If not, make adjustments to your budget and pay more.
Have you made gains towards your goals?
When you set out to change your financial habits, you probably made goals for yourself. Whether it’s buying a home, paying off student loans, or purchasing a computer, goals motivate you to save.
It’s a good idea to check progress towards your goals every few months. If you’ve become lax in your monthly savings allotment, review your plan. You can either re-commit yourself to your original strategy or alter it to fit your current financial needs.
Finally, remember to treat yourself when you hit a milestone along your path of financial progress. Going to a movie or having a meal out can be a nice and inexpensive way to acknowledge your hard work, and motivate you to keep going!