You dream of a happy and content life with a secured retirement doing what you like – travelling, reading, gardening, etc. But how can you achieve all this? It isn’t going to happen by itself, you have to work towards it by planning, saving and investing. You ensure this by doing regular assessment of your financial planning, like a financial health check up. Let’s discuss this further –

What is Financial Health?

Financial Health put in simple words is your preparedness to pay for anything at present or later which is expected or not. A steady income, low debt rate and consistent investments indicate a good financial health.

What is Financial Health Check up?

Just like how you do a regular physical check up to ensure that you are in the pink of health, you have to do a financial health check up to see how your financial planning is working and if you are on the right track. As you progress through different stages of life, your financial needs change along with your income. A financial health check up allows you to assess if these requirements are being met or if changes have to be made. It also allows you to see if your wealth has grown, if your investments are yielding what they should and what new financial instruments are available which you can invest in.

Why is Financial Health Important?

If you have an unstable financial health, this can lead to anxiety and stress and leave you worrying over how to pay your next month’s bills, your children’s education, retirement and for that matter even dining out with friends due to the cost of the dinner. This invariably affects your mental and physical health adversely. It is vital to have a sound financial health to maintain your health and also social standing.

How to keep track of Financial Health?

The best way to do so would be to improve your financial literacy. Understand the key aspects of finance which impact your financial health, such as –

• Savings – This creates a safety net for you and your family to meet your goals and any financial emergency.
• Debt – The lower it is, the better you are placed financially. Avoid taking unnecessary loans, especially the ones with high interest rates like credit card loans.
• Investment – The third aspect of finance which will help you grow your funds, just saving will not grow the funds, a sound investment will do. Equity, Insurance, Mutual Funds, FDs, etc are a few options.

As simple as it sounds, sustaining wealth is even harder than earning an income and growing it. As time goes by, you are at a higher risk of a health issue. Similarly as time goes by, and responsibilities mount, your finances are at a higher risk. To keep your wealth in check and on the path to growth, to make sure you do not deviate from your ultimate goal of financial independence, it is necessary you do a regular and consistent check-up of your financial health. A recommended way-forward would be to reach out to your dedicated financial advisor.