#1 - Create an Emergency Fund
• Start by setting aside $500 or $1,000.
• Your eventual goal is three to six months' of your living expenses
• Don't touch the emergency fund unless you have a true emergency!
• Begin with a simple savings or money market account. You can use more sophisticated investments later.
• Use automated savings tools that periodically transfer funds into savings and/or investment accounts.
#2 - Develop a Budget and Follow It
• A budget allows you to spend money on purpose. It can actually be a stress reliever!
• Include both short-term and long-term goals.
• Remember to use tax-advantaged arrangements like health savings accounts and flexible spending accounts.
• Major items include housing (rent or mortgage), utilities, food, clothing, transportation, insurance, medical expenses and taxes. But don't forget mundane, yet important, items such as life insurance.
• Consider college education savings funds for your children.
• Remember to include FUN as part of your budget.
#3 - Maintain Adequate Insurance Coverage
• Have enough life insurance to cover the financial needs of people who depend on your income.
• Make sure you have disability insurance to replace your income in case you are unable to work.
• Review your property insurance policies to ensure sufficient coverage. Don't forget about renter's insurance if you rent your personal residence.
• Consider whether or not an umbrella liability policy is appropriate for you.
• Remember to consider long-term care insurance, especially as you grow older.
#4 - Use Debt Wisely
• Avoid carrying balances on credit cards from month-to-month.
• Pay cash for cars and other major purchases whenever possible.
• Using debt for a home mortgage is acceptable, but make sure that the mortgage fits your budget.
• If you have excessive debt, start working on a debt reduction plan today.
• Wait 24 hours before making any major purchase decisions, particularly if debt is used to finance the purchase.
#5 - Attitude and Education
• Take charge and develop confidence that you can make wise financial decisions.
• Don't procrastinate. It is never too late to change the course of your financial situation.
• Don't fly solo. Rely on the camaraderie of your spouse, a friend or budget buddy to help keep you on track.
• Consider consulting a professional financial planner or a certified public accountant for assistance.
• Enroll in a personal finance class. Regularly read books and publications regarding personal finance.
• http://www.360financialliteracy.org/ is a great resource for financial literacy knowledge.
• Educate your children regarding financial responsibility. Include them in family financial decisions that are appropriate for their life stage. Leading by example will also help keep you accountable!