What does it mean to be financially fit? How do you know when you’re there?
Our level of physical fitness is obvious to most of us. I know for a fact that I’ve been more physically fit at other, earlier times in my life. When I was in my early 30’s for instance, I was probably in the best physical shape of my life. I worked out at Gold’s Gym for an hour in the morning, 3 to 4 times a week and I had a personal trainer. In the evenings, I went to the dojo and worked out doing mixed martial arts for up to 3 hours a couple nights a week. Although my body was fit and I looked great in a bikini, it wasn’t pure vanity that was motivating my activities, I did it to make myself a stronger person. I needed to become a stronger person to take on the next steps in my life, which unfortunately included ending a nearly 10-year marriage and moving from one state to another to start a new life. After preparing physically for a couple of years, I was more able to take on what I needed to do from an emotional standpoint as well. Over time, being physically fit began to make me more mentally and emotionally fit.
Financial fitness is kind of like that too. Just as my body didn’t become fit on its own – I had to work out to make that happen – I won’t become financially fit unless I focus my attention on that area of life and start taking the steps necessary to create financial fitness. Ignoring it and just hoping – or even believing – that it’ll get better on its own is an assurance that it is NOT going to happen. Just as you must manage your projects at work, you must manage your finances to make them comply with what YOU want them to do. I know it sometimes seems overwhelming, but remember the old question, “How do you eat an elephant? And the answer: “One bite at a time” is apropos here.
Everyone has their own idea of exactly what financial fitness means to them, but when you’re there, you know it. It just feels good! You know you have the resources to deal with whatever else comes up in life. You’re not “robbing Peter to pay Paul”. You’re cashflow is – well – flowing! You’re not concerned about having too much month left over at the end of your money. At some point that situation reverses itself, and you find you have money left over at the end of the month. Now you can do whatever you want with it – you can save it, invest it, buy something you’ve been wanting, or take a great vacation. Or, if you want, you can give it away to a worthy cause and not have to worry that your purchases or donations will have an adverse effect on your own situation.
One place you can begin flexing your financial management muscle again is by opening a savings account. We all feel a little better when we have something to fall back on in case of an emergency. According to Time Magazine this year, the average American has $5,300 in savings right now. This is an improvement over the numbers quoted 10 or 12 years ago, during The Great Recession, but of course, during the recent pandemic many people had to tap into their savings for various reasons as well. As we emerge from the pandemic, it’s important to consider replenishing our savings accounts before we move to the next phase of life. Sometimes it feels like we’ve been cooped up for years and we’re all itching to go on vacation. I know I am! But probably the wiser thing to do is to make sure my emergency savings account is re-stocked and then I can go without worry.
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