Planting Seeds
Spring is a time of growth and renewal. I always enjoy seeing our flower beds come back to life in the spring after a cold winter. One springtime tradition that my family has is to take a road trip to enjoy the Texas wildflowers in full bloom (and often some Texas barbeque). One of our favorite flowers is the state flower of Texas – the bluebonnet. One interesting fact about bluebonnet seeds is that they germinate in September through December – in the middle of winter! These seeds go through the winter months growing below ground while our plants above ground are freezing and dying. That process of growth beneath the surface produces the abundant flowers that we enjoy in spring.
Establishing good financial habits can be like planting bluebonnet seeds. It should be done early, can grow “beneath the surface” for a season, but provide stunning results once mature. Here are a few good financial habits to consider this spring that can lead to future financial growth:
1. Start Saving Early
One of the best financial habits that you can develop is to start saving early. Whether it’s for a rainy-day fund or for long-term goals like retirement or a down payment on a house, the earlier you start saving, the better off you’ll be in the future. Even small amounts of savings can add up over time with the power of compound interest. Even the mighty oak started out as just an acorn!
2. Build Good Credit
Credit is essential for many aspects of your financial life, including buying a house, getting a loan, or even renting an apartment. Building good credit takes time, so it’s important to start early by making timely payments on your credit cards, loans, and other bills. Keep your credit utilization low and avoid opening too many credit accounts at once. Good credit is like using good soil – it’s the foundation that the rest of your goals like buying a home or car can be built.
3. Invest in your education
Investing in your education is one of the best ways to improve your earning potential over the long term. Whether it’s going back to school for a trade or degree, or taking courses to enhance your skills, investing in your education can pay off in the future by opening up more career opportunities and increasing your earning potential. A good education is like Miracle Grow – and it’s a miracle how much it can make your income grow!
4. Develop a budget
Developing a budget can help you stay on track with your finances and avoid overspending. Make a plan for your income and expenses, and stick to it! This will help you develop good financial habits and avoid debt. I personally use an app for my budget that I can check daily to see if I’m on track. Like a well-planned garden, a budget can keep your spending on track and within expectations.
5. Practice smart spending habits
It’s easy to get caught up in the latest trends or to spend money on things you don’t need. Practicing smart spending habits, such as shopping for bargains, buying used items, and avoiding impulse purchases, can help you save money and avoid debt. One tactic that companies use extensively today is to sign up for a “free trial” or subscription to use their products. A recent study showed that 51% of Americans have unwanted subscriptions. Get out your pruning shears and cut back those weeds so your financial health doesn’t get choked out by unnecessary subscription fees.
Planting these seeds now can lead to a financial future that is in full bloom. If you want the help of a professional along the way, consider hiring a CFP® professional to help your plant the seeds for tomorrow’s financial success.
Published in the Victoria Advocate
David Faskas is a CFA and CFP® professional with KMH Wealth Management, LLC. He specializes in investments and portfolio management. He is the Chief Investment Officer, Chief Financial Planning Officer, and a managing member of the firm.
