Choosing a Healthy Chapter

I always loved all those “choose your story” type books. The ones that ask you to choose an outcome at the end of each chapter which therein determines the next chapter. I always enjoyed being the master of my destiny or at the very least, the story in question.

Granted, there is always a certain nervousness associated with reading these types of texts. What if I chose the wrong path? What if I missed a better outcome? Much like real life, we are often faced with at least two choices upon reaching a crossroad.

The first option typically is to do nothing and stay on the same path previously adopted aKa not a parents favorite. The second is to make healthier choices with your finances, health and emotional wellbeing.

When it comes to finances I try to always choose the second option. This habit stems from watching friends and family go down the rabbit hole of debt, it has managed to instill enough fear for me to choose to do better. From the time I got my first job till today, I try on the daily to maintain a well balanced financial life, which is by no means perfect but always in progress. Of course, I can’t say the same for all other aspects of my life but that’s for another story.

Example of a Healthy Financial Story

Chapter 1 – Start with a budget:  Choose a system that you’ll be able to maintain. I personally employ the pay yourself first method. I choose what is automatically transferred to my “savings” from every paycheck. The rest is set aside for my bills.

There are various methods available, you have to decide what works best for your lifestyle.

Chapter 2 – Track your spending: It may seem old fashioned but keeping record of your expenses is a great way to make sure your money stays onside. It is very easy to quickly fall off track with spending and knowing exactly where your weakness lays, helps maintain a budget.

Chapter 3 – Designate an account for savings: Keep your savings in a separate account. While it is a great feeling to watch your money grow specially if you plan on making a big purchase, not having easy access to it alleviates the temptation to spend it all.

Chapter 4 – Pay off debt: Make a plan and stick with it.  A good method is to tackle your accounts with the highest interest rates while making minimum timely payments on the rest. You will eventually make your way down until it is all gone.

Chapter 5 – Develop and maintain good credit habits: Credit cards are not the enemy. Most of them come with amazing perks such as cash back or points; which can be redeemed for various purposes such as travel or my all time favorite Amazon gift cards etc… As long as you use your credit cards wisely and pay your balance off monthly, you will be able to keep your credit up.

Chapter 6 – Invest in your financial future: We’ve already touched base on savings but it is smart to think long term, to think retirement. Put money aside in a 401(k) or IRA and just let the compounded interest do it’s thing. Nothing feels better than financial freedom and there are many advisors on the market who have the tools to help anyone of us tackle down a plan that works for the future we envision.

Wherever you are in your financial story right now, make sure to ask yourself if you have been making decisions that will help you live the life you want. You may not be able to change a previous chapter but the ball is always in your court. You control the next phase so always make it worth your while.

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