The link between your financial status and mental wellbeing is far from tenuous, particularly in an economic climate where the rate of inflation continually outstrips real wage growth.
This also raises significant concern in the UK at present, with Brits currently owing a cumulative total in excess of £1.5 trillion and the average household debt measuring a whopping £57,349.
This reinforces the pressing need for people to assume greater control of their finances and fiscal management, in order to create a sense of stability and drive future success and security. Given below are the steps to help you accomplish this objective:
Focus on Saving Income
To improve your financial circumstances and subsequently boost your wellbeing, you’ll need a clearly defined and ideally two-pronged strategy.
The first aspect of this should focus on saving money, through stringent and detail-oriented budgeting and a shift in outlook that compels you to commit as much of your disposable income as possible to savings.
In this respect, budgeting can serve as the balanced diet of your finances, while saving provides the much-needed exercise and physical activity. This analogy also works in terms of your approach to saving, which can be measured and tailored to suit your earnings and accounts to create a manageable plan.
As a general rule, aim to set aside a fixed percentage of your earnings for savings, whether this is 10% or more. This consistency will translate into accumulated savings over time, without compromising on your ability to pay bills or buy food.
Create New and Passive Income Streams
The second prong of your strategy should focus on income, as improving your earning capacity and the precise amount of money that you’re able to bring in will enhance your financial prospects no end.
Of course, the key is to target passive income streams where possible, as they’re relatively easy to sustain alongside a challenging, 9-5 job and career.
For example, activities such as forex trading allow you to target a lucrative market in real-time while leveraging automated trades and risk-management tools (such as stop-losses) to optimize returns without requiring you to spend huge amounts of time organizing your account.
Modern brokerage sites also enable you to access comprehensive analytical tools, while using demo account features that allow you to practice and hone your trading strategy.
Be Mindful and Track Your Spending
In order to optimise the effectiveness of your approach to financial prudence, it’s also recommended that you’re constantly mindful and able to track your spending on a daily basis.
The reason for this is simple; as this enables you to stick to carefully-cultivated budgeting plans and highlight any current or future spending challenges that need to be negated wherever possible.
Fortunately, there are various iOS and Android apps to help you achieve this aim, while ensuring that you have a frugal outlook and a keen grasp of your daily financials will also stand you in good stead.
We’d also recommend using key and neutral learning tools to understand the complexities of money management (such as interest rates), so that you can apply this type of learning to offer practical value.