Your guide to financial self-care in 2025
Consider This from NPR
Deep Dive
What is financial self-care and why is it important?
Financial self-care involves creating routines and habits to maintain a healthy bank account and overall financial well-being. It’s important because an overwhelmed or exhausted brain cannot effectively engage in financial planning, making it crucial to establish manageable practices for long-term financial health.
What is the first step in setting financial goals according to Brent Weiss?
Brent Weiss suggests picking a time horizon (e.g., 3, 5, or 10 years) and asking yourself what needs to happen for that period to be considered wildly successful, without mentioning money. This helps define the life you want to live, which then informs your financial goals.
Why is it important to check the interest rate on your savings account?
Interest rates on savings accounts can vary significantly, with some big banks offering as low as 0.01%, while others offer 4-5%. Ensuring your money is in a high-yield account maximizes earnings, and it’s essential to confirm the account is FDIC or NCUA insured for safety.
What are some key annual financial tasks to prioritize?
Key annual tasks include filing taxes, checking insurance plans, updating retirement contributions, reviewing investment accounts, setting financial goals, and ensuring you’re not missing any workplace benefits or paying for unused subscriptions.
How often should you check your credit report and why?
You should check your credit report every four months, rotating between the three major bureaus (Equifax, TransUnion, Experian). This ensures accuracy, as errors can negatively impact your credit score and borrowing ability.
What is the recommended buffer for a checking account to avoid overdraft fees?
It’s recommended to keep a buffer of 10-25% of your monthly expenses in your checking account to avoid overdraft fees. However, avoid exceeding 25% as money in checking accounts doesn’t earn interest.
What is the purpose of a 'brag bank' and how can it help professionally?
A 'brag bank' is a document where you record professional wins, compliments, and evidence of your performance. It helps during annual reviews or job applications by providing a ready-made list of accomplishments.
What is thought work and how can it improve financial habits?
Thought work involves reflecting on your thoughts, especially negative ones about money, and replacing them with affirmations. This practice helps create a positive mindset, reducing stress and enabling better financial decision-making.
- Focus on defining your ideal life first, without considering money.
- Financial goals should support your life vision, not be the sole focus.
- Examples: paying off student loans, maximizing retirement investments, saving for a down payment.
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