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The Financial Fitness Playbook

‎02-19-2014 01:47 PM

Our 14-step game plan can help you stretch your dollars, balance your budget and strengthen your financial future.


By Andrea Downing Peck

Photography by Jeff Wilson


1. Start with an exam.

“Before you start trying to get in better shape, you’ve got to assess your current condition,” says Scott Halliwell, a CERTIFIED FINANCIAL PLANNER™ with USAA. Begin with your net worth and cash flow. Net worth is calculated by subtracting what you owe (liabilities) from what you own (assets). Write it down. Your goal is to make this number positive and bigger by the end of the year. Next up, cash flow. How much do you have coming in each month and how much goes out? Your goal should be to have extra cash that you can save each month. Finally, review your various insurance policies. Are there gaps? For example, do you have enough life insurance coverage? Now it’s time to set goals. “With these measurements as a backdrop,” Halliwell says, “jot down your financial goals for the year and post them on your refrigerator or mirror. We want to keep them front and center.”




2. Plan for life events.


Jeff Rose, an author, financial blogger and CERTIFIED FINANCIAL PLANNER™, says you should delve into the nitty-gritty of finances at least once a year and any time you experience a major life event, such as marriage, buying a home or having a baby. “I don’t think you have to budget 24/7, but it is uber-important to sit down at those times and look at what’s going on with your finances,” he says. “If you don’t have a clue, it’s like going on a family vacation and not having a map. You may get there eventually, but it’s going to take a whole lot longer.”


Bonus tip: Try building a rainy day fund equal to three to six months of living expenses. This reserve can reduce the need to rely on credit cards or home equity lines of credit when financial emergencies occur. USAA’s Goals Planning Tool can help you save for short- and long-term financial goals. Go to


3. Get a technology boost.


Zero in on your spending habits with the help of USAA® Money Manager, an online budgeting tool. “Really get a handle on your money this year by recording everything you spend, every day,” Halliwell says. “After a couple of months, scrutinize each category for places to cut back or cut out altogether. Finally, save what you’ve cut each month.” Such tools “can help you stick to a budget and realize your financial goals,” says Ellie Kay, a USAA member and an author who writes about families and finances. “If you’re spending $30 a week on coffee and not putting $30 a week into savings, you’ve got a problem,” Kay adds. “A tracker can help you realize that.”


4. Negotiate your way to savings.


Permanently change your spending habits by reviewing your monthly outlays. “It’s one thing to save money here or there,” Kay says. “It’s another to become proactive in saving money on a regular basis.” Start by calling your cable television, pest control or other service providers and asking for a discount. They will try to keep your business, Kay adds.


5. Slash your technology bills.


Consumer advocate and USAA member Clark Howard recommends replacing traditional cellphone plans with low-cost smartphone service and dumping cable for on-demand streaming services and an attic-mounted antenna. “People can greatly reduce the cost of all the technology they are subscribed to,” Howard says.


To read the rest of the tips, download the latest edition of USAA magazine to your iPhone® or read it in PDF format.


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The preceding discussion is not tax, legal or estate planning advice. Consult with your tax, legal or estate planning professional regarding your specific situation.


Purchase of a product other than USAA auto or property insurance or purchase of an insurance policy offered through the USAA Insurance Agency, does not establish eligibility for, or membership in, USAA property and casualty insurance companies.


Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP® and CERTIFIED FINANCIAL PLANNER™ in the United States, which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.


Financial planning services and financial advice provided by USAA Financial Planning Services Insurance Agency, Inc. (known as USAA Financial Insurance Agency in California, License # 0E36312), a registered investment adviser and insurance agency and its wholly owned subsidiary, USAA Financial Advisors, Inc., a registered broker dealer.


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