When we think of self-care, most people immediately think ofmassages, a burning candle and a hot bath, picking out a workout activity thatbrings us joy and sticking to it, meditating or even practicing yoga. We recognize the importance in taking thetime to do something that nurtures our physical and emotional well being whichallows us to focus on practicing healthy lifestyle choices, yet we do not tendto consider our financial health in those practices.

If 2019 left you feeling overwhelmed, anxious and stressed about your finances, youre not alone. Money is the biggest source of stress in peoples lives more than their concerns about work, family or physical health. At a time when economic anxiety is increasing, over two-thirds of people (69%) identified financial health as having a significant impact on their well being.

People who report feeling clear about their financial goals report lower stress levels. So, what is financial self-care and how do we practice it? Financial self-care is about taking the time to check in, to focus on your finances, gain awareness and develop financial goals to ensure that you are financially well. Implementing a financial self-care practice comes down to three steps:

Track down pay stubs along with any other sources of income to determine how much money you have coming in each month. Review your paystub what is your after-tax income, i.e. your take home pay?

Gather and review monthly bank statements to determine your monthly expenses and to get an understanding of your spending habits. Categorize your expenses (mortgage, utilities, health, insurance, leisure, car payments, etc.) and tally them up.

Acknowledge your expenses and spending habits without judgment. Ask yourself what can you learn about how you spend your money? Are there any patterns? Is there room for improvements? This exercise is not meant to make you feel guilty, but instead it is about creating awareness and establishing a reference point to see where you are starting from.

Once you determine your monthly expenses, use the 50/30/20 rule to make a spending plan. Organize your expenses into 3 groups: 50% of your take home pay going to essentials (rent/ mortgage, loan payments, utilities, insurance, etc.), 30% going to lifestyle expenses (eating out, travel, shopping, etc.) and 20% going to future you (savings, investments, buying a house, retirement, etc.) Allow yourself some flexibility if the percentages above are not realistic based on your expenses calculated in Step 1, then adjust maybe it needs to be 80/15/5 or 60/20/20 or whatever mix works best for you.

Set smart financial goals for yourself. Your goals should encompass both the short term and long term. And, they should be smart: specific, measurable, achievable, realistic and timely. If for example your goal is to reduce debt this year, start by reviewing your spending plan. How much can you afford to realistically pay down each month? Your goal to reduce debt could then be revised into a smart goal such as paying off $300 of credit card debt per month. Your smart goal should be deliberate about how much money you would like to contribute to reduce your debt and how you plan to do it. Essentially, a smart goal will help you to focus your efforts and motivate you to increase the chances of achieving that goal. You can also take mindful steps to put any additional income like your bonus from work or tax refund towards your existing debt.

Take advantage of 401k employer match programs find out if your employer has a 401k program and whether they match contributions. If the company does match, take advantage of the free money and contribute enough to at least get the full match.

Make paying down debt a priority the faster you can pay off high interest debt, the more youre likely to have funds available for other things like travelling or saving; not to mention the more you will save on interest you owe.

Financial emergencies are going to happen, but you do not have to be unprepared if you establish an emergency fund. Start with an initial goal of $500, then $1,000 and work your way up to three to six months of your take home pay.

Keep your momentum moving forward and start contributing or increase your contributions to your retirement plan. You can also take steps to start investing in your future money goals buying a house, investing in your business, portfolio investments, etc.

Take small steps to feel good by usingthese strategies and implement them in your regular routine so you can boostyour financial well being not just today but in the long run too. The more we allowthe idea of self-care to permeate all aspects of our lives, the greaterlong-term impact it can have. Bydevising a regular financial self-care practice, you will strengthen yourresilience, boost your confidence and take control of your finances which willmake life just a bit easier to roll with challenges when they strike.

Excerpt from:
3 Actions You Need to Take to Help You Start 2020 on the Right Foot Financially - Thrive Global