Like cars, relationships and health, personal finance needs maintenance. Routine care now helps you in the future and alerts you to problems.
But check-ins can be easy to blow off, particularly if everything seems to be running smoothly.
“Comfortable might not be the best thing,” says certified financial planner Lazetta Rainey Braxton.
You can feel comfortable while missing opportunities to invest. “You can take your money for granted,” says Braxton, who’s also the co-founder and co-CEO of 2050 Wealth Partners, a financial planning and wealth management firm.
You may also sink a little too far into comfort while spending more as your salary increases, meaning you can’t save much.
Or maybe the issue is actually discomfort. If the very idea of reviewing bank statements stresses you out, why bother?
Whatever the reason for a laissez-faire money policy, it’s time to start tuning in — especially as effects of the coronavirus outbreak rattle the economy.
No need for a deep dive. Start with quick and painless check-ins:
You’re not alone if you typically wait until something goes wrong, like an overdraft, before reviewing your finances, says Amanda Clayman, financial wellness advocate for Prudential. Cue a traumatizing trifecta: You feel bad, you must scramble to understand your finances and what went wrong — oh, and you have to fix the problem. This experience can lead you to associate checking your finances with stress.
Money check-ins at neutral (not panicked) times can help you remove that association. So put check-ins on the calendar for about once a week, Clayman says. Scheduling also holds you accountable, she adds.
Keep them short and simple
Stick to a short time frame for these check-ins — say, 15 minutes. That way, “there’s less danger of being depleted and overwhelmed,” Clayman says.
To that end, don’t try to solve problems or change behaviors during this check-in. “It can actually be counterproductive if we try to load in too much analysis and change too quickly,” Clayman says. “That could sabotage you.”
Remember, check-ins should feel like neutral activities you don’t mind repeating — not stressful chores.
For the first several check-ins, Clayman recommends eyeing your cash flow. Note your common expenses and whether you spent more or less than you earned. You’re simply trying to become more comfortable evaluating your finances. And after a few sessions, you may notice the first benefit — these check-ins become “less terrible,” Clayman says.
At this point, you’re also trying to get more familiar with your money. That familiarity, Clayman says, “gives you more ammunition for if and when you do want to change.”
For example, you may learn that you typically drop about $40 on lunches during the workweek, which strikes you as too much. Down the road, if you want to cut spending, you know that lunches are a smart place to start. Knowing that $40 baseline will help you set goals — maybe next week you shoot to spend $30 on lunch. That’s a more intentional and achievable goal than just “spend less money.”
Respect your preferred learning style
There are many ways to track your expenses and cash flow: You could scrutinize your bank and credit card statements (either online or printed), download a template or spreadsheet, manually write down each transaction or try a budget app.
When choosing a method for your check-ins, consider how you typically learn best. “Work with yourself,” Clayman says. Do you generally prefer taking notes by hand? Do you understand visuals better than text? Do you get overwhelmed by too much info or prefer having all the facts? Factors like these will determine which of these tools you’re most likely to use consistently.
And if you find that a certain method isn’t working for you, try something else, Clayman says. Chances are, you just haven’t found the right fit yet.
Identify your motivation and rewards
Like all new behaviors, there will be some growing pains. “It’s going to feel new, and it’s going to feel weird,” Clayman says. But you’ve got this. “Find motivation that’s personal,” she says. Ask yourself how you’ll benefit from this new behavior and how it will change your life, she adds.
Rewards are pretty motivating, too. After each check-in, treat yourself to something special that you don’t do regularly. Maybe you soak in the tub and read a book, call a friend or hunker down for a nap. Whatever you do, Clayman says, “be extra good to yourself.”
This article was written by NerdWallet and was originally published by The Associated Press.