Smart self-care does not just mean spa days and movie nights: there are other therapeutic ways to reduce your mental and physical stresses, including how you manage your money. If your goal is to create healthier habits involving your personal finances, keep the following self-care essentials in mind. 

1. Consider your relationship with money.

Your spending and saving habits, not necessarily your income, can play the most significant role in your personal finances. The more you understand the psychology that underscores your financial habits, the more control you can gain over your finances. 

2. Outline your goals.

You work for your money, but your money needs to work for you. Sit down and outline your financial goals:

• How do you want to live?
• What comforts do you want on a regular basis?
• What are your plans for the future, personally and professionally?

Once you have a general direction, start plotting out a plan to achieve your short- and long-term goals. A financial professional can be key here. They can help you crunch the numbers and create a path toward your goals. They can also help you see when it might be time to adjust some goals so that they are all achievable.

3. Create a budget — and stick with it. 

A budget is critical. Some make tens of millions of dollars in their lives but end up having little left when it is time to retire. Others earn modest salaries, but their smart personal finance habits and discipline allow them to buy homes, send their kids to college, and retire in comfort. 

Your budget will depend on your income, living expenses, and personal preferences. To get started, consider the 50/30/20 rule. A basic budget earmarks 50% of your income for housing and other essentials, 30% for spending, and 20% for saving. In all cases, start with your income and outline your expenses. Then, use the rest to save, repay debts, and have a little fun. 

When you have a budget, you can relax but do not stop! You know that your essentials are covered, and your saving or investing efforts will meet long-term goals. But you still need to stick to it. Without a budget, life can feel messy and stressful, even if you have plenty of money coming in.

4. Expand your financial literacy.

To manage your finances effectively, you need to be financially literate. Make an effort to learn more about personal finances and investing. Listen to short podcasts weekly, sign up for financial newsletters, or consult with a financial professional. The more you know, the better you will be at taking care of yourself and your finances. 

5. Treat yourself.  

Financial management does not have to be about bare bones sacrifices and full austerity. If you approach budgeting in a punitive way, you may struggle to stick with your budget. Instead, find ways to build joy and even a little delight into your financial plans. 

You may not be able to have everything right now, but you do deserve to treat yourself. For instance, if you decide to start packing your lunch at work instead of eating out daily in order to boost your investing, you may want to enjoy a meal out on the weekend. 

Your personal finances can affect your stress, and they can also determine your present and future well-being. For the best results, look beyond the numbers and ensure that you are practicing smart self-care as part of your financial journey.

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

This article was written by WriterAccess.

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