That you are fair starting in the military or about to retire, or somewhere in between, small changes in your financial habits can improve your overall financial well-being. Here are some tips that can help you build healthy finances for the rest of your life.
1. Do business with a financial institution that meets your needs. A bank or credit union offering military-focused products and services is a great fit for serving and retired military. Many offer targeted services and resources that meet your needs at every stage of your military career and beyond. Federal Naval Credit Union, for example, is a nonprofit credit union that puts the needs of the military community and their families first. Not only do they offer a wide range of products and services, but they understand the demands and pace of daily military life.
2. Set (and stick to) a budget. Create and live from budget is one of the best ways to ensure day-to-day, long-term financial security. With a budget, you know where every dollar you spend goes and can plan for fixed and variable expenses. It also allows you to identify areas where you can reduce your expenses and keep you from overspending. Budgets can take a lot of the anxiety out of paying bills or waiting for your next paycheck — when you carefully manage every dollar that leaves your bank account, you can rest assured that your rent check or car payment won’t be not overdrawn or leave you with pennies until your next payday.
3. Save. Saving your money can take many forms. This could be building wealth for retirement, saving enough for a down payment on a house, or even building up an emergency fund for unexpected expenses. Whatever your goals or income, you can’t go wrong setting aside money each month to invest in your savings. At a minimum, experts advise keeping at least $1,000 in an emergency fund and working towards building up 3-6 months of living expenses. If you want to dive into some of the nuances of saving, check out this comprehensive article. article on Savings and Investing with Navy Federal. If you are still in service, here is a resource guideto start retirement savings before leaving the military.
4. Have no more debts. Debt without a plan to pay it off can quickly become a monster on your back. Although high-interest debt is often the riskiest, even low-interest debt, like a mortgage or student loan, can have a big impact on your financial health if you don’t have plan. This is where your budget can come in handy. Allocate your monthly finances to paying off your highest-interest debt first, then work to reduce your lowest-interest debt. Be sure to include plans to pay more than your monthly minimum – this helps you pay off your debt faster with less interest.
5. Build your credit. Good credit equals lower interest rates on loans and credit cards, better insurance rates, higher credit limits and more. Your credit score depends on a combination of several factors, such as your debt-to-asset ratio, on-time payments, and length of accounts. Discipline and time are key to establishing credit for the first time or repairing less than optimal credit. A budget can help you stay on track and accountable to your goals as you build your credit. Here is some tips for building credit if you are a mortgage for the first time.
Financial health is not rocket science – you everything already you need to develop healthy spending and saving habits. Good financial decisions start day by day and will help prepare you for a strong financial future.
This article was sponsored by Federal Naval Credit Union.