Financial health for 2023, six keys to fight against inflation

Put order in our personal finances: If you’ve ever wondered where all your money is going, you need to start making a budget. By tracking your spending, purchases, and savings, you’ll get a better picture of your finances.

The analysis of “ant” expenses or micro-expenses can generate some unpleasant surprises. But don’t despair, diagnosing them also presents opportunities to reassess and make the pertinent changes. This new year we can focus on making conscious purchases, limiting superfluous and impulsive spending and focusing on what we really need.

Reduce our debts or not get into debt: One of the best ways to “save” money is to pay off debt. Interest rates on debt are often much higher than those on savings, so it’s a good idea to prioritize eliminating any financial obligations you may have before saving or investing.

In other words, the sooner we can pay off our debts, the less we will have to pay in total. Reducing your debt load also has other benefits, such as increasing your credit score, allowing you to put extra money elsewhere. It also reduces stress and financial worries. From Value School they always advise living within our financial possibilities and borrowing as little as possible.

Improve our financial knowledge: Financial education is essential to be better prepared to make savings and investment decisions. Knowing the products in which we invest or with which we save is essential to be able to rest easy when managing our savings and assets. In order to preserve and increase our wealth and purchasing power, we must be clear that financial education must be a priority subject for all.

Set up an automatic savings plan: Saving should be a priority, even if it is a small amount. Automated savings is a good way to achieve financial goals. By depositing a fixed amount each month in a savings or investment account, the assets will grow little by little without us having to think about it. The objective of saving, which must gradually increase, is to have a financial safety net or mattress, which normally means maintaining an amount that allows us to cover between 6 and 12 months of fixed monthly expenses.

start investing: Well-managed investments can help protect the value of savings. Given the high inflation data and the loss of purchasing power that we are experiencing in this economic context, it is important that we put our money to work. Of course, not in any way.

In order to act successfully in the financial markets, we must bear in mind that We should only invest the money that we can lose. Although the experts help us and conscious investment is the right path, we cannot forget that investment always involves risks.

In addition, it is important that we know our investor profile when we select the financial product or asset in which we are going to invest. We have to be aware of what level of risk we are willing to assume with our investment and base our decision on it.

Likewise, we must always guide our investment in the long term. Conscious investing means putting money to work, hand in hand with expert managers and advisors, but without paying attention to the immediate and volatile movements of the market. The best way to carry it out is to have an investment plan and follow it for years, in order to collect good returns at the end of the journey.

  1. Beware of investment gurus or frauds: A good financial education and having the help of certified professionals by regulatory bodies will help us avoid falling into financial scams.

In general, from Value School they maintain that we should always be wary of those “investment gurus” who promise us high returns in the short term. The saying “no one gives hard pesetas” perfectly exemplifies this situation.

In addition, with new technologies and the rise of crypto assets, we must be more attentive than ever to possible scams or criminal activities in the financial field.

Raúl Cameo, Director of Value School, comments: “In a context of high prices and loss of purchasing power, financial education is essential. At Value School we bring the world of finance, savings and conscious investment closer to everyone. It is, in short, the place where the internet learns to save and invest”.

And he adds: “This beginning of the year 2023 is the ideal time to begin to better understand your savings and learn to manage your money. Putting your money to work thanks to conscious investment is essential”.

Financial health for 2023, six keys to fight against inflation