Tips to improve your personal finances and achieve financial health


Tips to improve your personal finances and achieve financial health

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The combination of terms finance and health was a bit unusual until a few years ago. The boom in the digital age and social networks has led to much more awareness on the subject because many specialists, brands and influencers are concerned with educating the new generations on the importance of improving personal finances and achieving financial health.

At a young age we would hear and see our parents talk about money and their financial concerns. The issue meant a source of stress and perhaps in many families it was not addressed due to lack of information, but today, the scenario is different and there is more knowledge about the mistake that means neglecting your financial health.

At BMI we believe that your well-being is the most important thing, which is why we share with you these tips that will help you achieve that much-needed balance between your personal finances and your physical health.

1. Avoid ant expenses

If you didn't know what ant expenses are, the term refers to all those small daily or regular expenses that seem irrelevant, but in the long run can add up to a considerable amount of money.

You should avoid falling for them because they consume part of your money and that amount could be used to save. You can include an amount for leisure in your monthly budget and each time you are going to make that expense, analyze if it is really necessary to do so. When you think about it and do not act impulsively, you will see that in the medium and long term your monthly budget will be more robust.

2. Save, even in small amounts

This should be a habit from an early age, having financial security for an emergency or some unforeseen event such as an illness, accident or loss of employment will allow you to assume this incident without worry and with the certainty that you will be able to cover it without resorting to any loan or unnecessary debt.

It may also be that in the future it will give you the opportunity to invest or start your own business, guarantee your children's university education or prepare to have a carefree retirement and enjoy that stage of life as we have all envisioned it.

3. Avoid going into debt

Borrowing is one of the most common mistakes and should be avoided at all costs because most of the time it means an additional financial burden that carries interest and associated costs that can easily add up and increase the amount you have to pay.

Having debts generates stress, financial dependence and also credit institutions report to the credit bureau, therefore, you must be up to date or otherwise your credit will be affected. Likewise, if you had planned the purchase of your home, buying a vehicle or changing the model you have would no longer be an option because your record would be affected.

4. Reduce your debts

If you unfortunately fell into some debt, you should be clear that the next step is to try to leave that balance at zero. Create a budget that is as grounded as possible that includes your income and expenses, then allocate a part to pay off the debt, but try to make large payments to avoid interest playing a trick on you.

If your budget is very tight, you can try to increase your income with a freelance or part-time job for a certain time so that you can pay off the debt in the shortest possible time.

5. Invest in the medium and long term

Investing in stocks, bonds or real estate will always be an excellent option because it will allow you to have liquidity. These types of investments have the potential to generate significant returns in the long term and most importantly, their value can increase significantly, allowing you to obtain solid returns that will allow you to increase and diversify your family wealth.

It is important that you take into account that investing in the stock market is synonymous with profitability, but it has a high risk due to market volatility. For its part, investing in real estate has less risk and greater stability, although the results of that investment will not be seen immediately.

Remember your financial health is not just a goal, it is a constant journey that you must take to achieve stability and economic well-being. At BMI we encourage you to follow these steps and try to build the habit of saving and planning to have stability and so you can focus on enjoying what is most important, family and quality time with them.

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