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How to Build Healthy Financial Habits

Becoming responsible with your money doesn’t just happen overnight. Learn how to adopt healthy financial habits and be the boss of your finances.

As you may have figured out by now, managing money isn’t exactly like running a marathon. You wouldn’t expect to throw on your tennis shoes, head out the door, and be able to run a 26.2 mile marathon out of the blue. In the same sense, you shouldn’t expect to become financially fit overnight either. It takes training and practice to become financially responsible and build healthy habits when it comes to managing your money.

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Follow these tips to get your finances in check:

Tip #1: Avoid Overindulging

Overindulging on food and spending can feel great in the moment and give you a short-term feeling of satisfaction. Unfortunately, in the long run, neither will help you reach your financial goals. Just like it’s difficult to see lasting results unless you combine a fitness plan with a balanced diet, you may not see improvement financially without adjusting both your spending and savings habits.

The first step is to establish a foundation. Think of “money in, money out” — the idea that you must spend less then you save in order to become financially stable — is the cornerstone of any effective savings strategy. When you take home more money than you spend in a given month, your savings account has a chance to grow. Even with “money in, money out” as your new financial mantra, you might still feel compelled to spend that extra disposable income. It’s important to fight the urge and instead set that extra money aside in your savings. To help control impulse spending, wait to buy things. If you think you need something, sleep on it. You may find a better price if you do your research, or you may decide you don’t need that item after all.

Start by taking a look at your current spending trends. Using eStatements, download your expenses over the past two months into a spreadsheet and then label each expense with a category (groceries, utilities, entertainment, eating out, Christmas, birthdays, cell phones, etc.). Once you’ve categorized each expense, sort the worksheet by category and then add up the expenses for each category. Are you surprised by how much you spent on eating out, going to the gym, buying groceries, or on entertainment? Paying close attention to these details allows you to develop a self-awareness when it comes to spending. By closely monitoring your personal finances, you might even notice certain spending patterns or unnecessary expenses that you can easily cut out. Maybe it’s a recurring fee on your credit card for a gym you’ve stopped using or those morning coffee runs accumulating at the end of the month when you have a coffee maker at home.

Doing this every few months will help you keep tabs on what and why you’re spending and allow you to adjust as needed.


Tip #2: Set Realistic Financial Goals

It’s important to understand that you cannot expect to see results if you only save money for a short period of time before returning to your old financial habits. Getting financially fit takes time and discipline — and it’s not always easy. But in order to see real results, you will need to stick to your new and improved habits.

One of your healthy habits should include setting a budget. You may not want a budget, but to really see your money grow, setting up a budget is an essential step on your journey to financial wellness. Don’t forget to follow the “money in, money out” rule. If you save more money than you are spending, then your savings is bound to grow.

Be realistic when you’re setting up a budget. For instance, if you know that you’re a person that likes to eat out several times a week and it’s something that you’re not willing to budge on, make sure that you allocate money for eating out in your budget. Sticking to a budget will get you closer to achieving your long-term goals whether it’s paying off your mortgage, getting out of credit card debt, or saving up for that new car. Find more information on how to create a budget here.


Tip #3: Automate What’s Important

It’s no secret that we live in an increasingly digital world, relying on notifications and calendar alerts that remind us to do everything from brushing our teeth to reminders for birthdays and doctors’ appointments. Consider automating what’s most important to you in relation to your financial goals. Take the responsibility of saving off your shoulders and set it up to happen automatically. Automating basic tasks like paying reoccurring bills or periodically transferring money from your checking account into your savings account are great ways to invest in your future self.

Set it and forget it. With online banking, you can set up your reoccurring monthly bills like internet and electric to automatically get paid on the same day each month using the BillPay widget. Automating payments is a game changer because you don’t have to think about it any longer and possibly drop the ball on your bills creating additional expenses with late fees. Making your monthly car or house payments on time will positively impact your credit score, which opens you up to more financial opportunities.

We encourage you to look into other automated tools like our RollUp Savings account which contributes to your savings with each purchase without having to think twice. In addition, consider scheduling automatic transfers which puts you on a schedule to transfer money into your savings account from another eligible account such as your checking account.

Like we said before, managing your money isn’t a marathon, and it sure isn’t a sprint. These things take time. Don’t be afraid to ask for help. Whether that is asking for a lower interest rate, forgiveness on making a late payment, or to lower you cable or internet bill. Don’t be afraid to take control of your finances and develop a financially fit mindset. You’ll be thankful you did.


If you’re looking for more ways to get responsible with your money, feel free to stop by any of our branch locations to learn about our financial counseling program. Or, check out more articles in our free, online Alltru Learning Center for additional financial resources.