“Every financial worry you want to banish and financial dream you want to achieve comes from taking tiny steps today that put you on a path toward your goals.” Suze Orman
Whenever a new year begins, new year’s resolutions and plans to improve oneself are all over the internet. From drinking less to working out more, many focus on their health and mental well-being, some on driving their career to new heights.
One topic that dominates during January is self-care, which encompasses tips for meditating as well as recipes for healthier dinners or alcohol-free cocktails. But there are other areas in life that might cause you stress and hinder your well-being.
Have you ever felt that money is causing you stress? 62% of Americans report that money is a significant source of stress for them, especially among those who are in debt (Source).
You might wonder why a crypto-exchange would bother educating people about their financial well-being. However, most people still live their life paying bills in fiat currency. Only once they have figured out their daily expenses, they start thinking about investing and eventually about buying their first cryptocurrency. It’s a lot easier for someone to successfully trade when they don’t have to worry about not being able to pay the next bill. Therefore, introducing people to ways of taking care of their financial health, is a logical step before introducing them to crypto-trading. At the end of the day, we are not interested in having people lose money they can’t afford to lose.
With all that being said, what is financial self-care?
While many associate self-care with putting on a facial mask, some cucumber slices and relaxing, financial self-care is about managing your finances in a way that doesn’t cause you stress. It is taking control of your money to achieve your financial goals.
So here are a few things you can do to de-stress your relationship with money.
- Analyze where your money is coming from and what you are spending it on: Before changing your current situation, it’s always advisable to analyze how you are using your money and how much you are earning in comparison. Only then, will you be able to set yourself realistic goals.
- Recognize individual needs: Everybody is different so, what people spend money on is very diverse. For some, it might be more important to spend money on maintaining their sports car while others prefer putting it into a vacation and yet another group would rather use all the money to do an MBA. Whatever it is for you, make sure to include it in your financial goals.
- Set yourself financial goals: These can be big goals such as the amount you want to save for retirement or for a long-distance university course. Make sure to include a specific amount, a timeline and a deadline to reach your goals. To achieve them you can make use of the 50–20–30 rule. This rule describes which percentage of your income you should dedicate to what: 50% for living expenses, this includes everything from rent to the daily grocery shopping, 20% towards savings and your financial goals and the rest for the nice things such as going out. Please note, this is a very general guideline and you can adjust it to fit your needs. For example, if your living expenses are generally lower, you could change it to just 30% and increase what you put into savings.
- Prioritize debt payment: There is good debt (that increases your net value such as a student loan) and then there is bad debt used to buy depreciating assets such as cars. What they both have in common is that they make us feel stressed. Most people don’t feel comfortable being in debt. If you’re one of them, you can do your health a favour by prioritizing debt payment. Nevertheless, since we are living in a time with historically low-interest rates, letting your debt run for a bit longer could be a viable option depending on your goals.
- Start talking Finance: Ever encountered awkward silence in a room after someone dared to ask someone else about their salary? In many western countries, money is not a dinner party appropriate topic and asking someone about his salary is often seen as a taboo. While we don’t recommend the topic for a first date, it helps to talk about your concerns with money with a trusted friend or family. It might feel like you are the only one stressing about it, but rest assured, you are not. Talking about your finances with someone can help you feel more comfortable with your situation. And who knows, you might even find a money buddy who helps hold you accountable for financial goals.
- Find what works for you: There are several apps that can help you manage your finances better. For example, you can use an expense tracker to find out what you’re spending money on. When using one of the mobile-only banks (Monzo, Revolut, N26) they already analyze for you what you’ve been spending money on. To increase your savings you could use an app like Money Box that rounds up all your purchases and puts that money aside for you. Qapital even allows you to combine the amounts you save with a specific goal such as a trip to Paris or buying a new bike.
After you’ve figured out your financial goals and are on a good path to achieving them, it’s time to think about what to do with the money you have on hand for investing.
As mentioned previously, we are living in a time of low interest. Therefore, letting your money simply sit on a bank account won’t do you any favours.
As long as you’ve got some emergency funds saved together, you can go ahead and start investing some of the money you have for “fun” things. You could even decide on a certain amount of your salary you want to invest each month. While there are many options to use some spare money if you are comfortable with some risk and love fast results cryptocurrencies could be for you.
Not really convinced yet?
We could probably follow with a lengthy explanation on all the amazing benefits of cryptocurrencies and how bitcoin has outperformed most traditional investments, but the best way will still be for you to gain hands-on experience. The beauty of starting with crypto is that you can start with minimal amounts.
Got $30? You can easily turn those into Bitcoin or Bitcoin Cash on Bitcoin.com Exchange and get started with trading.
What do you have to lose?
The amazing opportunity to get a feel of cryptocurrencies and the potential they have.