5 Habits of Financially Fit People - ACE Cash Express

5 Habits of Financially Fit People
Does it seem like some people are naturally good with their money? Their savings account blossoms, they travel every
year, and their credit score shines? It’s not magic or luck that gets these savvy people far. Instead, discipline and sound
money habits make financial fitness possible.
People aren’t born with the innate knowledge of how to save money. Financial fitness is taught—and it’s a skill set
anyone can learn!
What is Financial Fitness?
The CFA Institute (Chartered Financial Analyst Institute) defines financial fitness as:
“... feeling good and confident about your financial situation. It means being able to manage your money in order to
meet your current and long-term needs.”
When you feel in control of your spending and saving, you feel more confident about the future. Saving for your child’s
college tuition feels doable. If your vehicle breaks down and you need to consider buying a new car , you have an
emergency fund prepared.
With a financially fit mindset, you’ll know how to use credit cards responsibly. You’ll also know when it’s an appropriate
time to seek out a loan to meet your financial needs.
So, what makes someone “financially fit?” We’ve uncovered 5 money management habits you can incorporate into your
lifestyle.
How Financially Fit People Save Money with 5 Practical Money Management Habits
1. They Set Future Goals

Life moves fast. Sometimes it feels like one moment you’re saying, "Happy Friday!" to all your coworkers, and the next
thing you know, it's Monday again. When you're always on the move, it's challenging to find time to take a step back and
see the big picture.
However, if you want to improve your financial fitness, cultivate a habit of setting long-term goals. Financially fit people
know the destination they desire for their life (even if they may not be 100% sure how they’ll get there.)
No one can predict the future, the state of the economy or the plot twists life can throw your way. But you can still set
goals including:
When you want to retire
How soon you want to buy a house and pay off your mortgage
How much money you want to save for your children’s education
The lifestyle you want to have as you age
2. They Automate Their Savings Account Transfers
Many people find it challenging to put money into their savings accounts. When money is already tight, those dollars
you want to put into savings can easily be used for other purchases. That’s why we recommend automatic transfers to
your bank savings account as a financial fitness habit.
Open a new high yield savings account and set up direct deposit with your employer for a small amount of your
paycheck. Depending on your budget, 10-20% of your paycheck is a good place to start.
You’ll likely find that it’s much easier to stick to your savings goals when money automatically deposits. In this instance,
“out of sight, out of mind” can be a helpful mantra.
3. They Adopt a Cash-First Approach
According to ValuePenguin, “the average American carries 2.35 credit cards and a total outstanding balance of $5,551.”
Purchasing items on credit is the norm for many Americans, but financially fit people make smart decisions about how
they use their credit. They choose to make a habit of using a cash-first approach for spending.
Adopting a cash-first mindset ensures you live within your means. Some ways to implement this habit into your financial
life include:
Leaving credit cards at home when you head out to run errands or shop
Removing credit cards from your saved card information online
Try the envelope method for cash budgeting each time you get paid
4. They Set Up Automatic Bill Payment
One of the most important factors in determining your credit score is your number of on-time bill payments. Keeping
track of upcoming bills on a spreadsheet or your phone can be a challenge. That’s why financially fit people choose to
set up automatic bill payment withdrawals. This ensures they always pay bills on time, and there are fewer headaches
about maintaining regular bills.
You can set up automatic ACH (Automatic Clearing House) payments through your biller or from your bank provider.
Remember that just because you set up ACH payments, doesn’t mean you can forget about your bills.
Each month check your due dates and how they correspond to your pay cycle. If you need to move payments around or
save a little more money in one check to cover the transfer, be sure to include that. That way, you won't be surprised by
unexpected automatic withdrawals.
5. They Budget for Personal Spending

The standard advice you may hear involves cutting out personal spending from your budget if you want to save money.
At ACE, we believe that part of what makes life special is indulging in occasional purchases that add meaning to your life.
However, with finances, just as with your physical health, overindulging can cause serious damage.
People who are financially fit make room for special purchases within their budget, rather than in spite of it. There’s no
reason to feel guilty for buying takeout one evening when you’re too burned out to cook. By planning, you can make
that purchase and still stay on track.
As you put together your budget for personal spending, consider what matters to you and your family:
Weekly family dinners at your favorite restaurant
Morning coffee from the local coffee shop
Seeing the latest movie at the theater
Adding new pieces to your wardrobe monthly
Staying current on trending shows from your favorite streaming service
Make it a habit to put money to the side to cover these "special" expenses and feel more confident in your purchase
decisions.
The health of your finances is in your hands. Make these 5 financial fitness tips a habit and improve your budgeting
skills!
Want even more money management tips? Head to Facebook to join the conversation!
Sources:
https://www.cfainstitute.org/-/media/documents/support/future-finance/seven-steps-to-financialfitness.ashx?la=en&hash=9A5A6FE359855C80409F51AE950004A962454FF3
https://www.valuepenguin.com/average-number-credit-cards-per-person