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As we welcome in a New Year, many Hoosiers are thinking about their New Year’s resolutions and what they’ll resolve to do differently in 2007. Many will make resolutions geared toward improving their lifestyles and their physical health by losing weight, exercising more, and giving up smoking. But there is another aspect of maintaining a healthy lifestyle that all Hoosiers should add to their resolutions this year - financial health.
Being financially fit means understanding not only your income, but also how much you spend, how much you save, how much you invest, and ultimately, your credit history.
In an effort to help more Hoosiers get on the right track toward financial fitness, Indiana Investment Watch has created some resolutions for you to consider in 2007:
Control Your Spending
You can’t save your money if you’re always spending it. Instead of buying the newest gadget on the market, put that money aside for your investment and savings accounts. A good rule of thumb when it comes to savings - save at least 10 percent of your income.
Create a Budget and Live By It
Handling your personal finances without a budget is like Peyton Manning playing without a playbook. A budget is a great way to get a grip on your finances and will keep you in line with your long term spending goals.
Be Credit Card Smart
Are you using your credit card a lot? If your balance is $1,000 and you pay the minimum of $35 a month with an 18 percent interest rate, it will take you three years (and an extra $315.54) to pay off the card. If you are unable to pay the balance in full each month, pay more than the minimum and be sure to pay on time to save yourself from late charges and higher interest rates.
Pay Yourself First
Retirement’s not going to pay for itself. Take advantage of your company’s 401(k) program or set up an IRA. Employers typically offer some sort of matching on 401(k) contributions, and that’s like free money!
Investigate Before You Invest
Before you invest your money, make sure the investment and the person selling it are legitimate. All corporations should be registered with the Indiana Secretary of State’s office. You can visit www.IndianaInvestmentWatch.com to check the licensing status of your broker/dealer and make sure the security is registered.
Financial fitness won’t happen overnight, but you can start taking the proper steps now to better prepare yourself for the future.