Reflection is taking time to think about your past experiences. Financial reflection is taking time to think about your finances and how you can manage your finances effectively. By reflecting on your financial habits and behaviours you can gain a better understanding of why and how your actions have impacted your current financial status.
Reflection provides an opportunity to consider, untangle and sort through experiences to create meaning. This meaning becomes learning, which then informs better future actions and behaviours.
This month we focus on how important financial reflections are: looking back on what we have done to move forward.
Reflecting on financial behaviour
If you want to know what your financial actions, habits and behaviours are, we encourage you to look at your bank statements for the last three months.
These statements will quickly show what you do repeatedly and what you can avoid doing. For example, paying your accounts late; having debit orders returned; or overspending on weekends, are some of the negative habits you will be able to identify. Also looking at the positives, for example, paying more than the minimum amount on a credit card; or reducing your monthly entertainment expenses.
Reflecting on the “Why?”
Think about when your relationship with money started. Was it in your childhood? Was it when you earned your first paycheck? Your financial past has an impact on the financial decisions you make every day and understanding your “why” makes it easier to make better choices.
Reflecting on the results
What can you learn from your financial actions and behaviours? What results have you achieved? Your current financial status will help you to determine which of your financial actions and behaviours are helping you and which are hindering you in achieving your financial goals.
Reflecting on better ways
Once you have a better understanding of your finances, you can begin to reflect on ways to make better financial decisions and cultivate more helpful financial habits.
One helpful question is: “What change can I make today to improve my financial situation?” If you are unsure where to start, it always helps to go back to basics, for example, drawing up a budget; eliminating unnecessary expenses; and reducing your debt. Or, for today, it could be as simple as just reaching out for help.
Remember, your financial coach is available to guide and assist you in every aspect of your finances, from choosing better financial actions to cultivating financial habits such as saving for your dreams and building a secure retirement fund.
Simply contact your Interface financial coach here for amazing support as you reflect on your financial situation and implement better actions and habits that will help – not hinder – you in achieving your financial goals.