How to Track Financial Fitness

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 Stacie Carrabine By: Stacie Carrabine
Source: Fitbit

Until recently I wouldn’t have been able to tell you how many steps I walked, how many calories I burned, or my current heart rate on any given day.  Now, I have a clever, little device to tell me all of this at the push of a button… and I love it!  What I like most about my fitness tracker is that it brings an awareness to what I’m already doing, providing information that I can easily view and act on.

We often hear how the choices we make today can affect our future health, and we think the same is true for our finances.

This leads to the question, “How many of us are aware of our financial fitness?”  We spend and make money almost every day of our lives yet, I would guess, most people have no idea of how to measure the results of the actions we take in financial situations.

It can be a daunting task when you don’t know where to start. To simplify, just think of the questions you would ask your financial fitness tracker. Here are the questions we would start with:

“Am I sticking to my budget?”

The very first visual that scrolls across most fitness trackers is the number of steps you’ve taken that day. You know your goal for the day and how many steps you still have to complete to reach your target.

You’ve taken the steps to complete a budget, and now comes the part where you hold yourself accountable for what you are actually spending.   Do a regular check-in to compare spending vs. the goals outlined in your budget. Get in the habit of checking your financial health.

Regular check-ins allow you to identify areas of spending where you need to pay more attention or where you’ve gone off track.  Being aware of spending habits is the first step; the more regular you check in the more satisfied you’ll be with your progress.

“What goals have I set for myself?”

As you know, your step count and active minutes are tied to how many calories you’ve burned according to your tracker. Once you’ve started tracking your budget, you can see its effect on your financial goals. And answering the question, "Are you on track to meet them?" becomes much easier.

Take some time to think about your future goals and what you need financially to achieve them.  We all want to be financially independent. For some, this may be retirement; for others, it may be spending more time doing charitable work.  The good thing about long-term goals is that you can start small: putting away what you can today and making an active effort to increase the amount you save each year. When you earn a bonus or raise from a job well done, increase your rate of saving towards your goals. Building this habit as your career progresses will only increase your success rate.

Nothing is more satisfying than getting your fitness tracker to buzz at the end of the day when you complete your goals. Imagine the satisfaction you’ll get from successfully reaching your financial goals!

“How do I feel about the investments related to my goals?”

Once I complete my workout, I can analyze my heart rate over that time.  The trend I see each time is that my heart rate goes up and down during my workout. And, frankly, that’s what I expect to see.

Similarly, when investing for your financial goals in the market, you should expect movements in your investment values. But over the long term, you can expect positive trends for your investment outcomes. Take your pulse on your financial heart rate. Do you feel comfortable with your goals through the ups and downs that occur in the financial markets?

A lot of goals are tied to timing and where you are in your life. Be sure to reevaluate your risk tolerance as changes happen to your family, your income or your goals. You should be prepared to acknowledge that the markets are not within your control, but staying in the markets and rebalancing will keep you on track.

Staying financially aware is an easy step to keeping tabs on your financial fitness.  Just picture scrolling through these items on your wrist regularly to get in the habit of checking in.  Make sure you’re on track and following your budget, think about you and what goals you want to achieve, and keep tabs on how you’re investing for each goal.

The peace of mind that comes with being in good financial health is just as important as the peace of mind that comes with keeping up with your physical health!

 

This post was written by a member of the Plancorp Women’s Initiative, which strives to advocate for clients and women in the community by addressing topics specific to their financial lives. For more information about the Women’s Initiative and how you can get involved, visit the Plancorp Women’s Initiative page.

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Born and raised in Fairfield, Iowa, Stacie moved to Missouri to attend Saint Louis University, where she graduated cum laude with her BSBA in Finance. She draws on her financial and analytical background every day at Plancorp, working with the investment and operations teams to maintain portfolio balances, make rebalancing recommendations and execute trades. More »