5 Ways You Can Engage In Your Finances Today

I recently joined Kathy Murphy, president of Fidelity personal investing, for a webinar on financial wellness to help women take charge of their financial lives. (Men were welcome to listen in, too.) We were inspired because we know more women want to get involved. As Kathy writes, a Fidelity survey shows 92% want to learn more about financial planning, and 83% want to get the ball rolling within the next year.

But there’s no need to wait even that long. You can get started today with the following five moves:

Start saving, automatically.  

The best way to save money consistently is to put it on autopilot. This is why 401(k)s work so well – they swipe money out of your pay before you have the opportunity to spend it. The trick to boost your savings is to use the same tactic with IRAs, SEPs, 529 college savings accounts, Health Savings Accounts and even plain vanilla savings accounts. (I funded a recent vacation with months of auto-transfers ahead of time. It made the bills much less painful when they rolled in!) 

Start an emergency fund.

In the hierarchy of savings, your emergency fund comes first. Yet, three in five Americans don’t have enough in savings to pay for the unexpected. Ask yourself: “How long would my money last if my income were to suddenly disappear?” If your answer is less than three months, then that’s your first savings goal. Automatically shuttle 2% of your monthly pay into that account. More, if you can swing it.

 Take the money on the table.

What’s the last free lunch in America? Matching dollars on retirement contributions. Yet 25% of Americans don’t grab them all, because they don’t save enough of their paychecks for retirement, according to Financial Engines. Employees who fall short leave an average of $1,336 on the table each year (for a grand total of $24 billion altogether). If that’s you — and you’re not at a place where you can comfortably save more to get that match — then commit to saving some or all of your future raises and bonuses. Even better, if your company will automatically increase your savings rate once a year (usually by a percent or two of your salary), sign up. As Olivia Pope would say: "That’s done."

 Check your credit.

When was the last time you pulled your credit report? Research from Bankrate reveals 35% of American adults have never reviewed any of their reports, with another 14% admitting to (regularly) going more than a year in between checks.  If it’s been more than four months, then you’re due for a check. And note: Checking your credit score is just as important. You can do it for free at sites like SavvyMoney.com and CreditKarma.com. 

Talk some cents. 

I know 60% of Americans would rather talk about anything else (i.e. politics, sex, religion or health), but talking about your finances – particularly with your significant other, if you have one -- is essential for learning about your finances. If you’d feel more comfortable speaking with a professional, then consider sitting down with a financial advisor.