The Importance of Being Financially Fit

Are you ready to stretch those financial fitness muscles? We hope so, because it’s time to get financially fit!

Being financially fit means living a life of complete financial responsibility. The Center for Financial Services Innovation defines four basic components of financial health: Spend, Save, Borrow and Plan. These components reference everyday financial activities. As such, every choice you make in terms of these four activities either builds or detracts from your financial fitness. Like physical fitness, you can beef up those fitness muscles a little bit more each day.

Being financially fit is crucial for a well-balanced, stress-free life. Here’s why - and how.

What Does It Mean To Become Financially Fit?

Expand Your Financial Knowledge

Becoming financially fit means never stopping learning. Financially fit people read, listen, and stay aware of economic changes so they can make confident money decisions based on knowledge, not luck.

Stick To a Budget

A financially fit person knows where their money is going. They track expenses, plan for fixed and discretionary costs, and stick to their budget to keep their finances on track.

Minimize Debt

Actively living a financially fit lifestyle means actively paying down debt and avoiding new debt when possible. Smart budgeting, planning ahead, and ongoing financial education help prevent small setbacks from turning into long-term debt.

Maximize Savings

A financially fit person treats savings as a priority, not an afterthought. By building savings into their budget, they create emergency funds and future security—making it easier to handle life’s surprises with confidence.

Share Certificates (CDs) help financially fit savers lock in a guaranteed return. The longer your money stays invested, the higher the interest rate—helping your savings grow steadily over time.

Money Market Accounts offer higher interest than traditional savings with added flexibility. They’re a great option for becoming financially fit while keeping emergency funds accessible and insured.

Maintain Complete Awareness of the State of your Finances

Financially fit people know exactly what they earn, owe, spend, and own. This clarity reduces stress and makes everyday financial decisions easier and smarter.

Maintain a Healthy Credit Score

A financially fit person protects their credit by paying bills on time and keeping balances low. Strong credit opens the door to better loan rates, saving money over the long run.

Help Your Money Go Further

Being financially fit means avoiding unnecessary interest costs. By living within their means and using credit wisely, financially fit people free up more money for saving and investing.

Create Concrete Financial Goals

Financially fit people set clear short- and long-term goals. These goals guide daily decisions and keep them focused on building the future they want.

Achieve Financial Independence

A financially fit person is in control. With smart budgeting, consistent savings, and financial awareness, they build stability, confidence, and true financial independence.

Being financially fit means living a life without battling anxiety about getting through the month or stressing about the future. You can achieve financial fitness by committing to making choices in each of the four components of financial health - spend, save, borrow and plan that are forward-thinking and help to build your financial wellness. 

 

© Genisys Credit Union and www.genisyscu.org, 2020. Unauthorized use and/or duplication of this material without express and written permission from this site’s author and/or owner is strictly prohibited.  Excerpts and links may be used, provided that full and clear credit is given to Genisys Credit Union and www.genisyscu.org with appropriate and specific direction to the original content.

 

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