Welcome back to Money Mile, the podcast for active people looking forward to an active, phased financial independence. Together we’ll share a mile so that you can learn how to build a better life.
In today’s episode, you’ll hear the 5 foundations of financial fitness that we’ll be exploring in depth over the next several episodes. Make sure to stick around until the end to hear your homework!
You will want to hear this episode if you are interested in…
- The 5 foundations of financial fitness [0:52]
- Your homework [3:04]
5 Foundations for financial fitness
- Spend less than what you earn. Even though this tip seems like a no-brainer, there are a huge number of people who fail at this one. To succeed at this first step you must understand how much you earn and know where it is going. Whether you call it a budget or a spending plan, deciding how you will spend your money gives you control over your finances. In the next episode, you’ll hear 10 tips to help you improve your spending plan, so make sure to subscribe to hear it!
- Do something intelligent with what is leftover. There are thousands of things you can do with your money, but doing what works for you is the most important.
- Protect what you can’t afford to lose. It doesn’t matter how much progress you make toward your financial goals if you can lose it all in the blink of an eye.
- Build wealth systematically. Do the things that work well for you. Try new things, but do them systematically and for at least 6 months to test them out.
- Use debt wisely. Historically low-interest rates have allowed banks and other lending institutions to give borrowers a significant amount of resources with little oversight. With student and credit card debt increasing at alarming rates, it is important to remember that banks do not have your best interest at heart.
It’s homework time! Financial independence isn’t won with only knowledge, it is earned by taking action. What you do is more important than what you know, so make sure that you take action!
With each episode, I give a bit of homework to complete. Your homework today is to consider what area of your finances you think you need the most work on. Make sure to listen to the following episodes to hear tips on how you can improve in that area.
How have you been doing with your homework? I’d love to hear your thoughts. Let me know how you have improved your financial situation or even suggestions for areas that you would like more help with. Email me to share your ideas.
Remember, if you work out everything else will too!