The last decade has been a roller coaster ride for many people. The economy has gone through some pretty tough times, and it’s difficult to make long-term plans when you’re feeling like the rug might be pulled out from under you at any moment. But don’t give up! There are plenty of ways to stay afloat in this volatile world. Today I’m going to share with you five tips that can help ensure your financial security—even if things get rough down the line.
Track Your Spending
Tracking your spending is an important step in achieving financial security, says Vincent Camarda. Tracking your income and expenses can help you identify areas where you are spending too much, or not saving enough. If you don’t know how much money is coming in or going out, it’s difficult to understand what changes need to be made in order for you to get on track with saving more money each month.
In order to track your spending effectively, I recommend using a spreadsheet where there are columns for each month; one column labeled “income”; one labeled “expenses”; another labeled “savings” (or whatever goal amount). In each row of this spreadsheet, write down all of the transactions that occurred during that period (or even just estimate them).
Keep Your Credit Score In Good Order
A good credit score is one of the most important numbers you can have in your life, says Vincent Camarda. It’s a number between 300 and 850 that indicates how likely you are to pay back a loan.
The higher your credit score, the better chance you have at getting approved for loans or lines of credit with lower interest rates (which means less money paid back overall). This can be especially helpful when buying a house or car, as well as getting cheaper insurance premiums since many companies use them as an indicator of risk level.
Get Life Insurance
Life insurance is a contract between you and an insurance company. It can help protect your family’s financial future by providing money for things like medical bills, funeral costs and lost wages. Life insurance policies come in many different forms, with different features and benefits. For example:
- Term life insurance provides death benefits for a specific period of time; if you die within that period (known as the “term”), the beneficiary receives a payout from the policy amounting to the sum insured plus any dividends based on how long it took to pay out those dividends
- Permanent life insurance offers guaranteed lifetime protection against death or disability–meaning that if something happens to you during that time frame (usually 20 years), then beneficiaries receive all outstanding payments owed under their respective policies
Don’t Be Dependent On One Income Stream
One of the biggest mistakes you can make is to rely on one source of income. Making sure your income is diversified and diversified into multiple sources will help you achieve financial security, because if one source dries up, you’ll still have others to fall back on.
Diversification can mean different things for different people: it could be having multiple bank accounts or investments; it could mean having multiple jobs; it could mean owning properties in different places. Regardless of what form “diversification” takes for you personally, make sure that whatever form it does take doesn’t put all eggs in one basket!
