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Becoming financially fit

9 Ways to become financially fit

This spring give yourself a financial wellness review to make sure your finances are in optimum health.

When we neglect our physical health we often give it a kick start to get back on the road to better fitness. Similarly our financial wellbeing can sometimes benefit from a new routine or a refresher.

Here are some ways to enhance your own financial fitness:

1. Warm up with financial literacy training

A strong financial plan should have a strong foundation of financial literacy. If you’re at the lower end of the literacy spectrum, you might want to start off easy…like mastering a 5K run before you tackle 10K.

Subscribe to weekly newsletters from financial or investment magazines, follow well-known Canadian financial bloggers or podcasters, check out YouTube. Taking information in small doses over time can be less strenuous on the brain muscle than trying to digest entire books or courses. And be sure to check out all the resources on our website. We have a wealth of information you may not be aware of, including videos, calculators and tutorials.

2. Don’t get weighed down by debt

How damaging debt is to your financial health really depends on the kind of debt you have. Just like where you carry any extra weight on your body has a greater or lesser impact on your health. What’s particularly “unhealthy” is high-interest consumer debt, particularly credit cards which can have interest rates as high as 19%. Mortgages or low-interest lines of credit are “better” debt because of their lower rates. Learn more about being smart with debt.

3. Ensure you have a healthy credit rating

Your credit score is used in many ways, from getting a credit card or mortgage, to getting a job in certain fields. Not paying bills on time can hit your credit rating hard, making it difficult and more expensive to borrow money. You can check yours (available from TransUnion or Equifax) to see if there are any issues. Financial Advisor Scott Evans recently talked about how to repair poor credit scores in a segment for CTV News’ McLaughlin on Your Side. Watch the segment or read the article.

Monitor your debt

Any debt review isn’t complete without a check of your credit report (available from TransUnion or Equifax. Mistakes can hit your credit rating hard, making it difficult and more expensive to borrow money. Activity listed in your file can also tip you off to attempts by others to get credit in your name, or worse.

4. Balance your core investments

To reduce your vulnerability during times of global economic difficulty, it's important you have a strong core of investments – one that is well balanced and diversified. If you haven’t reviewed your asset mix in a while, now’s the time. Your advisor is a great help in this area and can draw upon his or her experience in both bear and bull markets. Learn more about adding stability to your portfolio.

5. Make saving a routine

There’s nothing like a routine to get you into good habits – for physical health and financial. Like exercise, you need to make saving a priority and make it regular activity. One of the easiest and most effective things you can do is set up a pre-authorized monthly contribution to a savings account, or one that is tied to your pay schedule. Your savings will grow effortlessly and you’ll earn additional compounding interest on your investment throughout the year. Learn more about reaching your savings targets.

6. Stretch your savings with a TFSA

The TFSA is a powerful savings tool and for 2019, the maximum annual contribution has increased to $6,000. If you have never contributed (and factoring in the maximum contribution for each year) you could contribute up $63,500 in 2019. Learn more about TFSAs.

7. Work with a personal advisor

Just like with a personal trainer, establishing a relationship with a financial advisor that’s the right fit for you can be a tremendous help in achieving your goals. What makes the right fit? You’ll want to start by looking at their credentials. Although there are numerous designations, the Certified Financial Planner (CFP) accreditation is the most highly regarded. Of course, experience is also critical. And finally, there will be the right chemistry – someone you can relate to and who takes time to get to know you and your goals. Learn more about choosing an advisor.

Our most recent client experience survey confirms that we’re making a positive impact on our clients’ financial well-being to a great extent, which sets us apart from other financial institutions.

We earn top marks from the poeple that count

*Ipsos, 2018. Results from clients working with a financial advisor at their primary financial institution.

8. Have a safety net and maintain it

In weight training, it’s a spotter; in sailing, it’s your life jacket. In your financial life, it’s insurance. Too often life insurance winds up being a get-it-and-forget-it proposition. It’s essential to regularly review your policy so your coverage keeps up with what’s happening in your life. Life insurance can continue to serve you as you age, your income increases, and your priority shifts to building and transferring wealth. A key benefit? Tax savings. Learn more about insurance considerations for changing needs.

9. Build your endurance for the long-run

Financial literacy is a lifelong process. Research shows that those who take a single course in money management or finance perform no better when tested for financial literacy. The acquisition of effective and relevant knowledge, skills, and attitudes takes time and a long-term commitment. Use your key life events as learning opportunities. Stay up to date on the latest financial trends through newsfeeds, newsletter subscriptions and bloggers. And don’t forget to check our website; we have a wide range of resources including investment calculators, mortgage selectors, and a series of advice videos.

Your financial health – as unique as you are

No matter what stage of life you're at, consulting a professional financial advisor can help you explore your options and determine the best strategy to meet your goals. Make an appointment today to review your financial fitness and ensure you’re on track for optimum financial health.

Comments or suggestions? Please email us.

The information contained in this article was obtained from sources believed to be reliable; however, we cannot guarantee that it is accurate or complete. This article is provided as a general source of information and should not be considered personal investment advice.

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