Steps To Keep Financially Fit In 2016

Volatility in the global markets and financial world is widening. The uncertainty pushes all market participants to be extremely cautious in the beginning of 2016. Beginning with a new year may open us up to new opportunities as well as new threats. To stay in a healthy financial status, we suggest mini steps to keep you financially fit that may ease your financial journey throughout 2016.

Step 1

First of all, having a healthy financial balance begins with a clear motivation. To be in line with your financial expectations and the market expectations, you clearly should know what you are aiming for with a sound financial balance at the end of the year.

What are your plans for this year and the year ahead? 

You can see these questions as the answers of your mid-term and long-term plans for your financial planning. You should write down your major financial goals for 2016 and prioritise them such as;

1. Education

2. Retirement Savings  

3. Home Savings

4. Holiday Savings

5. Car Purchase etc.

Your list should realistically reflect your budget, lifestyle and your goals. Having this list on your mind, you should find it easy to decide financially when new opportunities come along and you will immediately realize whether they are threats to your goals.

Step 2

To be in line with your goals, you first need to know your exact balance; you should know your net wealth in terms of your assets and liabilities. You should be aware of your existing debts, recurring payments, taxes and your loan payments. It is important to take them into account in a timely manner because when they are not handled properly in their due time, they may cost you more with their accumulated interests. Additionally, knowing these liabilities will give an overall estimation of how much you should spend for these expenses for the entire year that will make you savvier and elaborate roughly on the limits of your spending budget.

Step 3

Having written down your mid-term and long-term goals, and having reviewed your liabilities, you can decide on a reasonable saving expectation/amount for the year based on your expected salary.

Step 4

After completing the three steps above, this should give you the confidence because you now know your balance and expectations. You should also consult an expert/financial advisor for any investments you may want to look into. Regardless of your budget and risk appetite, there are various types of investments that you may want to enrol consisting of high risk/high reward investments to secure/safe and steady returns. You will benefit from financial expert advice since they are more adapt to understand market structure and behaviour and will direct you according to your risk profile to a realistic investment portfolio that will maximize your returns.

Step 5

Next to investing financially, investing in your health and covering your health expenses will also benefit you in the long-term. Getting a health insurance as well as insurance coverages on your house, car, and personal possessions will help you to protect your assets and minimize the unexpected cost and expenses in the future. While we understand some readers may not have to worry about these expenses yet, it’s important you have a good idea of future financial expenses.

Step 6

In addition to the above steps, get acquainted with the financial news. Watch the news regularly and you will be surprised how fast you acquire the financial markets terminology that will make you sound like an expert.

Every long journey starts with a single step, thus, you have made it halfway through by reading this post and applying these steps will get you more than the half way in 2016.


This post has been written by Kiako

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