While Preventative Medicine is an intricate medical specialty all on its own, Physicians agree that working to prevent health conditions is instrumental in promoting the well-being of patients. Especially when compared to Reactive Medicine, the importance of Preventative Medicine is clear. If you can deter or eliminate an issue in your physical health from occurring before it becomes a serious problem, then why would you not take the same approach with your financial health?
Millions of Americans each year see their PCPs for their annual physical/checkup as a precautionary and preventative measure, the same approach should be taken with their finances. Instead of waiting for problems to pop up, check in routinely on both your health and money. This is something that needs to be screamed from the mountaintops since the medical community is the leading by example in such a powerful and impactful way.
Experts believe and advice that your finances should be reviewed and discussed at a minimum every six months to help you ensure you are on track towards accomplishing your financial objectives along with addressing any inefficiencies that can occur.
Throughout each stage of life, your financial desires change. It’s important to assess how they have changed and what financial decisions need to be addressed. What should your financial health checkup consist of?
First, you should consider your cash situation. Make sure you have a cash buffer, or rainy-day fund as some call it, for unexpected situations that might arise. If this is not the case, prioritize increasing your savings, even if you’re just getting started.
Second, take inventory of your spending habits. It’s important to shine the light on where your money is going. This is also a good time to review credit card statements and student loan payments if applicable. Adjustments to the allocation of your money should be made as deemed necessary.
From here, understand where you’re saving/investing money and why. Your retirement plan contributions are most often overlooked because it is payroll deducted and is generally not felt in the monthly cash flow scenario. Once you’ve done this, look at your other investment accounts to make sure it is still in line with your financial needs and objectives.
Medical & Financial health alike, Preventative treatment plans are most desirable. It is always better to anticipate and prevent emerging issues
In taking these steps, you are checking in on your finances routinely and educating yourself on how to adjust your financial decisions as your life progresses. While doing so, it is essential to keep your financial needs & wants in mind. Often as you see with your patients, speaking to a Financial Advisor can help alleviate the stress and uncertainty that impacts your life.
Sources
4803969RLB_June24
Comments