10 Keys to Help Build Financial Security

Sep 6, 2024, 09:55 AM by Nuvision 

financial security

Building financial security is a journey, not a destination. But with the rising cost of living and economic uncertainty, the path might feel more challenging today than ever. According to the Federal Reserve’s 2023 Report on the Economic Well-Being of U.S. Households, many Americans are still facing financial strain. However, with a little planning and the right strategies, you can start building a secure financial future today. Let’s explore some practical, achievable steps that will help you create a strong financial foundation. 

Everyday expenses continue to take a toll on households. Over two-thirds of Americans report feeling stressed about daily costs. In 2022, the Bureau of Labor Statistics found that the average household spent nearly $73,000 on basic needs like housing, childcare, and utilities. These rising costs make it more difficult for many to save, and with grocery bills being one of the top frustrations, families—especially younger generations—are struggling to find room in their budgets for anything beyond the essentials. 

With all these challenges, saving money has become more important than ever. According to the recent report, 37% of adults would have difficulty covering an unexpected $400 expense. With that in mind, we’ve gathered tools, resources, and support to help you build financial security even in these challenging times.

The Importance of Savings 

Saving money isn’t just a good habit—it’s essential in today’s unpredictable economy. With rising costs and financial uncertainty, it’s more important than ever to set aside funds for emergencies and future goals. 

1. Create a Budget 

Budgeting is the first step toward taking control of your finances. Knowing where your money goes each month can help you identify areas where you can cut back. Use apps like Mint or YNAB (You Need a Budget) to simplify this process. A budget will give you a clear picture of your financial situation and help you stay on top of your spending. 

The Federal Reserve’s 2023 Report found that 35% of U.S. adults were just getting by or finding it difficult to make ends meet. This underscores the importance of tracking your income and expenses to avoid financial stress. 

2. Pay Yourself First

One of the best ways to ensure you’re always saving is to pay yourself first. This means setting aside a portion of your income as soon as you get paid, before paying bills or other expenses. Warren Buffett famously said, "Do not save what is left after spending, but spend what is left after saving." Even small amounts can add up over time and boost your financial security.

3. Automate Your Savings

Set up automatic transfers from your checking account to your savings account. This way, you won’t be tempted to spend the money. Automating your savings makes it easier to stay consistent, and many banks and credit unions, including Nuvision, offer this feature. As financial author David Bach notes, "The key to building wealth is to make it automatic."

4. Cut Unnecessary Expenses

Take a look at your monthly subscriptions and memberships. Cancel the ones you don’t use regularly. Think about dining out less and cooking more at home. These small changes can add up. Is your purchase a want or a need? You’ll be surprised how much you can save by eliminating unnecessary spending.

5. Build an Emergency Fund

Aim to save three to six months’ worth of living expenses to cover unexpected costs like medical bills or car repairs. Having an emergency fund gives you a cushion to handle life’s surprises, keeping your financial plans on track. The Federal Reserve Report noted that many households remain unprepared for emergencies, highlighting the importance of this step.

6. Use Cash-Back and Rewards Programs

Take advantage of cash-back credit cards and loyalty programs to save money on everyday purchases. Just be sure to pay off the balance each month to avoid interest charges. Nuvision’s Visa Rewards Card offers competitive rewards on everyday purchases, making it easy to earn points for things like travel, gift cards, or even cash back. Financial expert Clark Howard states, "Using cash-back and rewards credit cards wisely can essentially provide a discount on everything you buy."

7. Save on Utilities

Simple changes can lower your utility bills. Turn off lights when you’re not using them, switch to energy-efficient appliances, and reduce water usage. These small adjustments can add up to significant savings. According to the U.S. Department of Energy, reducing energy use can save the average household up to 25% on utility bills.

8. Buy Generic Brands

When shopping for groceries, try generic brands, which are often much cheaper and just as good as the name brands. Consumer Reports found that store-brand foods cost an average of 27% less than their name-brand counterparts. Many of the same companies make both, so switching to generic can help you save without sacrificing quality.

9. Set Specific Goals

Having clear savings goals can help you stay motivated. Whether you’re saving for a vacation, a new car, or a home, knowing exactly what you’re working toward makes it easier to stick to your plan. Break down your goals into smaller, manageable milestones, and celebrate progress along the way.

10. Learn and Adapt

The financial world is always changing, and staying informed is the best way to protect your financial future. Whether it’s new tax laws or changes in interest rates, staying up to date on the latest trends can help you make smarter decisions. Take some time each year to review your financial situation and make adjustments as needed. It’s also a good idea to consult with a financial advisor periodically to ensure you’re on the right track.

Nuvision Is Here to Help

At Nuvision Credit Union, we understand how challenging these times are. We’re committed to providing the tools, resources, and support you need to build a strong financial future. Whether you’re starting small or saving big, we’re here for you every step of the way. Building financial security takes time and dedication, but with the right strategies and support, you can set yourself up for success. If you need assistance or have any questions, don’t hesitate to reach out—we’re here to help.