These days, financial stability really sounds like an elusive subject. We indeed have bills to pay, and a life to lead. But, if we don’t take a seat, analyze, and create a financial bucket list, then we risk living within the shackles of our obligations. Here are eight financial tips that can help anyone secure their financial future and enjoy financial stability.
Create a passive income
Financial stability is a result of hard and creative work. And if you want to enjoy it, then you need to get creative too. That said, we cannot always control our expenses and bills, but what we can actually control is how much income we realize. Generating more revenue to offset any financial obligations one may have been an excellent way to go. A passive income is any income you generate from a job or task you are not actively working at. There are many ways to get this done, and the most popular ones are through websites, rental properties, small online businesses, freelancing, online trading, and affiliate programs.
Live without debt
Debt is one of the many obligations capable of ruining anyone’s shot at financial stability. If you are still living in debt, it is almost impossible for you to be stable financially, let alone secure your financial future. Do you have credit card debt, personal loans you are paying off, or mortgage to attend to? All of these are going to hinder you from leading a financial future and becoming stable financially. Hence, you have to be rid of any debt you may have before you look to become stable financially because, without that, financial stability will continue to elude you. There are different ways to tackle one’s debt, depending on the terms and duration of the debt. From the traditional debt consolidation method to the highly effective IVA scheme, debt of any kind can be addressed and resolved.
Create a 3-month emergency fund
Whoa, that’s a lot of money! Once you are done breaking the shackles of debt around you, the next thing is to start preparing for the future. And a 3-month emergency fund would be a great place to start. Emergency funds are there for the rainy days, which is why you need to have one today if you really want to enjoy financial stability. Think about it, instead of going to get a loan to deal with an unforeseen event; you can dip into your emergency funds.
Open a money market account
Preparing for the future doesn’t necessarily mean preparing for the next few decades ahead; instead, your future could be tomorrow. And if you don’t have a robust financial platform to rely on, you may find it absolutely difficult to attend to your existing financial obligations and emergencies. In that light, having a money market account is another vital requirement for anyone interested in experiencing financial stability. A money market account is quite similar to a standard savings account, albeit with higher returns and better access to your money. Checking with your local bank is a great way to research the ideal account for you.
Create a vacation account
The best time to visit your dream country is while you are on holiday. But how many people can fulfill this dream? And how many of those who eventually achieve this do so without getting into debt? Don’t be one of them! Visit your local bank and create a separate account where you can stash little cash every month for your next vacation so that your next holiday wouldn’t break the bank.
Improve your Credit and FICO Score
That you don’t run a business today doesn’t mean you may never be entrepreneur, and the fact that you have some cash in your emergency funds doesn’t mean you will always be able to resolve every financial emergency that comes your way. Hence, it is always great to have a good Credit and FICO Score as you never can tell when you might need to obtain funds from external sources to either finance your big business idea or resolve your unforeseen emergency. Your FICO Score determines what sort of risk a future creditor is willing to take on you. Having a high, and above 700 FICO Score is quite feasible if you pay all your existing debt as at when due, keep credit card balances low, and pay your bills on time.
Have a retirement plan
Start saving for retirement today with a 401k or an IRA plan. You should talk to your financial advisor to determine which plan is best suited to your needs.
Authored by Uday Tank.
Uday Tank has been working with writing challenged clients for several years. His educational background in family science and journalism has given him a broad base from which to approach many topics. He especially enjoys writing content after researching and analyzing different resources whether they are books, articles or online stuff.