5 Signs You’re Putting Your Financial Fitness First!
Summer may be on its way out the door, but let’s not forget about those get-fit programs we started when the weather started warming up. And, no, we’re not talking about daily workout regimens or online accountability groups that use hashtags like #flexfriday. Instead, we’re talking about financial fitness! Whether you’ve got short-term or long-term financial goals of saving to buy a home, putting your children through college or enjoying an early retirement, there is no time like the present to make sure that your finances are in good shape. But, how do you know when you’re financially-fit? Today, we’re examining five sure signs of great financial health: You’re prepared for an emergency. You’ve heard of a rainy day fund and you may even have one; but, financially fit people typically have saved up enough for about a rainy six-month fund. This type of emergency fund usually consists of six-months of pay that is only to be used in emergency situations, like job loss… not, that emergency vacation you just know you need! Your debt-to income ratio is not over 33%. Ah, yes, the debt-to-income ratio that lenders often use as a baseline for mortgage approval… if we’re talking fitness, you may want to liken this to your least favorite exercise at the gym. If the sum total of your debts divided by your gross income is less than 1/3… you can breathe a little easier knowing that your financial health is strong. You really know where your investments go. Simply investing in your 401K or other retirement fund is not a great indicator that you’re in good financial health. Get to know your savings statements and feel confident that you’re working toward your savings goals. For this financially-fit tip, the actual exercise is getting familiar with your savings plan and routinely examining it to make sure it is still working for you! Your car payments don’t drive you crazy. No, the signs of a financially fit person are not seen in the rearview mirror as they speed by in the newest sports car around. That is, unless, of course, they’ve paid cash for that sports car! When a person is able to live without car payments, their financial picture is typically pretty sound. If you and your spouse have two cars, but only one car payment, you’re driving your way toward great financial health! You regularly give to charity. And, you’re comfortable doing so. At heart, many people may aspire to be a philanthropist, but only financially-fit people are able to fulfill those aspirations by regularly contributing to causes that are important to them. When you feel free to support your favorite causes without worrying about how much you’re able to give, you may be able to consider yourself financially fit. Like any workout plan, these five signs of financial fitness are simply goals that we all can strive to reach. On your own journey toward financial health, you may need to modify some of your personal spending, saving and credit-paying habits in order to reach these goals. But, once you reach one or more signs of great financial health, you may also notice a boost in your own personal health. So, when it comes to financial fitness, this is one workout program you won’t want to abandon! This post is sponsored by PA Preferred Mortgage: Pennsylvania Preferred Mortgage is a full service mortgage banker and is a member of the Prosperity Home Mortgage, LLC family. Specializing in residential and refinance loans, Pennsylvania Preferred Mortgage offers a wide range of mortgage products, including fixed and adjustable rate mortgages, jumbo loans, Federal Housing Administration (FHA) and Veterans Affairs (VA) loans, and renovation financing. Learn more at www.papreferredmortgage.com.
