Revisit Your Financial Relationships
In order to prevent another financial crisis, what changes will you need to make to your current financial relationships? Consider the following.
- Career. Do you need to increase your income with a second or a part-time job? Is there room for growth in your current career, or should you consider additional education or training to help boost your earnings?
- Home. Do you currently live in an expensive location? Does it make sense to downsize your home or move to a lower-cost area?
- Family. If you're financially supporting adult children, can you reduce or discontinue it? Similarly, if you support your elderly parents, can your adult sibling(s) share the financial burden of care?
- Habits. Do you overspend to reward yourself? Are you an emotional shopper? Do you buy things you actually want, or are you just trying to keep up with the Joneses?
- Health. Can you make a lifestyle change to improve your health to help avoid future issues and potentially reduce medical costs? Some of these changes will require careful research (e.g., moving or changing careers), whereas others can be easier to implement (e.g., avoiding shopping sprees or reducing aid to adult children). Reassess your finances periodically As you get back on the right financial track, it's critical to monitor your progress. Failure to do so in the past might have contributed to your crisis, so make it a habit to periodically review your finances. You might benefit from working with a financial professional who can help you stay on track with your financial goals as your situation changes.
2016 Survey of Consumer Finances, Federal Reserve Board (most recent data available)
Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2019
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