When it comes to finances, boring works
Why Smart Financial Planning Feels but Isn’t Boring
Financial planning often feels cardio. You know it’s good for you, but you’d rather binge-watch Squid Games while pretending money grows on trees. Getting your finances in order doesn’t have to be as dull as walking on a treadmill. In fact, once you see the benefits, you might even enjoy it. Here’s why you need to set up or track these key financial metrics.
1. Have Liquidity for 3-6 Months of Expenses
Having 3-6 months of expenses stashed in a savings account means you’re prepared for life’s little or big(COVID) curveballs.
Think of this fund as your financial "get out of jail free" card. Without it, you’re one unexpected expense away from picking up a second or third job.
2. Know Your Net Worth
Your net worth is like a report card for your financial life, except you don’t have to show it to your parents. It’s simply the difference between what you own (assets) and what you owe (liabilities).
Tracking your net worth helps you spot trends. You can see if your assets, like your investments, are growing, and that you are paying down your mortgage or student loans.
3. Set Up Auto Contributions for RRSP, TFSA, FHSA, and RESP (If Applicable)
Automation is the lazy person’s secret to success and a way to avoid emotional decisions. Setting up automatic contributions to your RRSP, TFSA,FHSA, or RESP ensures your money is working harder.
Every payday, a chunk of your income goes straight to your future self without you lifting a finger. It eliminates the temptation to blow that money on Uber Eats or Amazon deliveries.
4. Set Up Annual Increases in Contributions
Setting up annual increases in your contributions is like putting your financial growth on autopilot. Even a small bump (say, 1% more per year) can add up. The best part is, you won’t notice.
5. Track Your Expenses, Including Subscription Services
Remember that free trial you signed up for two years ago? Yep, still charging you $12.99 a month. Tracking your expenses reveals what you value and what’s draining your wallet.
From the groceries to the extras (streaming subscriptions, delivery apps), a good tracking system gives you clarity and control.
At the end of the day
Financial planning doesn’t have to be scary. By setting up and tracking these key financial metrics, you’ll save yourself from future headaches, take that vacation guilt-free, and you’ll sleep better knowing you’ve got a solid plan in place.