How To Discover More About Your Financial Health Before Seeking Upgrades

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So, you wanna improve your financial situation in 2021? You’re not alone…

However, like any other year, most people that set out with this new year’s resolution will fail. In the majority of cases, any hopes of success are suffocated by a lack of clarity regarding current situations.

So, before identifying any potential room for improvement, you must analyze your current situation.

If you want bad habits to die, give yourself a financial autopsy including these eight great factors. In turn, your financial rebirth will yield better results.


#1. Gain a full understanding of your salary

Financial health is determined by far more than your salary alone. Nonetheless, your earnings will always lay the foundation of your financial situation. Consequently, then, it is pivotal that you analyze your situation by looking at the full picture.

It’s one thing to know your annual salary, but you should also break that down into relevant timeframes. A biweekly paycheck calculator will give you a far clearer idea of whether your earnings are enough to finance your lifestyle.

Crucially, when combined with details of daily or hourly rates, you’ll know whether a better job may be out there.

In addition to the pre-tax and post-tax earnings, you should consider the factors that influence your financial health. Does the company pay for your car or train travel? Will your employer match your 401K contributions?

The answers to those questions will give a clear indication of where you currently stand. As well as what next steps may be needed.


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#2. Analyze your current spending habits

Managing your finances is an immensely difficult task. However, the formula for success could not be simpler to understand. If your outgoings are smaller than the income levels, your financial health will improve. As such, analyzing your spending is pivotal.

Even when you have the desire to increase your earnings, it will take some time to make it happen. Conversely, changes to your spending habits can show positive results with almost instant results.

Use a money tracker app or Excel spreadsheet template, and you will quickly see that money has been wasted. Now is the time to stop those issues.

Common sources of financial waste include overspending on cell phones, broadband, and TV deals. Likewise, changing utility or insurance firms could save money without any negative impacts on your life.

Food consumption should be analyzed too as around one-third of all food waste ends up in the trash. You could save money here.


#3. Understand the impact of your debts and interest

Prioritization is a massive feature of leading a more responsible lifestyle. While it is very easy to get caught up in consumerism, you must resist it. When you allow your debts to keep growing, the impact of interest rates will seriously slow your path to a stable status.

Therefore, you must take accountability for your past mistakes. Using an interest rate and payment calculator will show you just how much you are overpaying due to those debts.

When you see those figures, the reality that you need to find a quick solution becomes clear. Consolidation and debt relief options are available to you.

While loans and credit cards are the items that most people naturally consider, it doesn’t stop there. Store cards are an equally dangerous feature, not least because they are only used to buy luxuries.

Cut them up, put an end to the spending, and focus on clearing the balance. Once you do, it will lift a huge weight of stress from your shoulders.


#4. Get your credit score under control

Financial health isn’t determined solely by your bank balance, assets, or cash flow. In truth, any item that can influence your future financial opportunities deserves a lot of attention. Because you never know when circumstances may force you to require those services.

We all need to borrow money or take items on credit from time to time. This could range from taking out a cell plan to buying a home.

Either way, a deeper understanding of how to build a strong credit score will serve you well. When this situation improves, you will be offered more products, including those on better terms.

Credit score building alone counts for very little. However, when used to support responsible spending and borrowing, you will see a big improvement. The first step is to get your free annual credit report.

This will instantly show any inaccuracies or issues that you will want to target over the weeks and months to come. What more could you ask for?


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#5. Check savings accounts and investments

If you are consciously building towards a brighter financial future, you’ve probably opened a savings account. Sadly, most people are guilty of taking the savings account offered by their primary bank provider. It’s a decision made through convenience but could be damaging.

Therefore, you should analyze the interest rate paid by your bank provider and compare it against the other products on the market.

Meanwhile, you may want to look at different pension plans or ISAs. They may be supported by higher interest rates or government incentives. Finding the right options could boost your financial health by thousands.

Another possible outlet comes courtesy of investments. Whether trading stocks or backing businesses in return for equity is up to you.

For the lowest risk, you’ll want to create a fairly diverse portfolio. Aside from the prospect of increased capital growth, it may offer better versatility and control. You’ll be able to cash out some of the assets if required.


#6. Know your home’s true value

Given that successful asset management has such an integral role to play, you must not overlook the need to understand your property. It is the biggest asset you’ll ever own. So, it makes sense to maximize its value with upgrades that provide a positive ROI.

There are plenty of projects that could deliver positive financial results. Eco-friendly upgrades, loft conversions, and summerhouse constructions are just some good examples.

In truth, though, all properties are unique. With this in mind, arranging a professional survey should be high on the agenda. This will provide definitive answers.

More importantly, it will tell you whether the property value has changed much since you purchased it. This will be highly important if you are thinking about selling in the near future.

Even if this isn’t on the agenda, the knowledge of the property value, as well as your current loan-to-value (LTV) ratio, can put you in a more powerful position.


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#7. Investigate possible revenue opportunities

While your career should form the main focus of your earning potential, it’s always good to have other possibilities. Even if you don’t need them right now, there could be a time where they become essential. Knowing them today will prefer you for what tomorrow has in store.

Perhaps the easiest way to earn extra money is to take on overtime at work. So, knowing what your boss pays for overtime in unsociable hours is a great starting point for your research.

You may find that motivational speaking, tutoring, or ways to share your skills and experience works too. In some cases, this could aid your hopes of future promotions.

Meanwhile, opportunities may be available in a wide range of external arenas. From becoming a content creator to taking on work as a TV extra. When you have fun with the side project, it doesn’t matter if the earnings are small.

It will also prevent the threat of becoming mentally tired from a poor work-life balance.


#8. Know the financial situations of your family

Transparency is the most important factor in analyzing your finances. If you truly want to see exactly where you stand, you need to look beyond yourself. You also need to consider the impact of your financial dependents and partners. Otherwise, nasty surprises can occur.

If you are planning to get a joint mortgage, for example, both of your salaries are important. A joint mortgage calculator will help you understand how much money the banks may be willing to lend.

Similarly, your partner’s savings for the downpayment will combine with yours to create the final result. You must not ignore it for a second.

Meanwhile, you may take on responsibility for your partner’s financial obligations, such as debts. Parents will also need to consider their child’s education fees, as well as other costs that may surface from time to time.

Finally, if you have co-signed an agreement to help a friend or relative, you should keep an eye on their financial health too.



Good financial health doesn’t translate to being rich. It primarily focuses on establishing a sense of stability. It also incorporates the idea of being prepared for unforeseen situations that can occur. After all, many families could not even handle an unexpected $500 expense.

With the above steps used as a foundation to analyze your current situation, you will quickly remove the fear of uncertainty. In turn, it’ll allow you to plot your future steps in style. You’ve got this!

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