10 Money Questions (Besides "What's My Salary?") to Ask Yourself Regularly

10 Money Questions (Besides 'What's My Salary?') to Ask Yourself Regularly
by Hillary Hoffower
Photos Stephanie Yang | October 24, 2016
It’s no secret that we spend a large amount of time reflecting on various aspects of our lives and asking ourselves how we can improve them.
If you were to make a list of your personal reflections in order of most commonly thought of, what would it look like? It’s a likely guess that your career is at the top. Close things that follow might be relationships, becoming healthier, and of course, how you’re doing on curating that timeless wardrobe. And the list goes on (such is life). But ask yourself — just where does finance fall on the list? If the stigma of finance as an often avoided topic is true, then it probably hasn’t found a high spot (and if it has, good for you!).

Why is it that we don’t always give money the same care we give other elements of our lives? Dealing with money can be difficult. It can be stressful. It’s fun to spend. But the guilt that comes after is not. It takes some work and planning — but tracking your finances is essential for stability. Make sure you’re periodically asking yourself these 10 questions — it’ll pay off in the long run.

1. What are my mandatory expenses each month?

Figuring out how much you absolutely have to pay each month is the first step to creating a good budget, as you’ll then see how much you have remaining for other expenses. It also helps you determine how much should be written on your paycheck, thus providing a guideline when it comes to negotiating your salary or raise. Mandatory expenses include fees for rent or mortgage, utilities, any loan payments, cell phone or cable bills, and the like.

2. How much can I save each month to meet my financial goals?

The general rule of thumb is 20 percent of your salary, but if after calculating your mandatory expenses, you’ll barely be scraping by if you put that much away, don’t feel like you have to follow this rule. But, make sure you’re tucking a little bit away because something is better than nothing.

3. Do I have at least three months of my salary saved for emergencies?

Again, general rule of thumb is to have three to six months’ salary saved in case something happens. Whether your car breaks down, you end up with a large medical bill, get laid off, or quit your job to start a business, you’ll be thankful for this cushion.

4. What’s my credit score?

It’s a common myth that checking your credit score will bring your score down. While a hard inquiry, such as applying for credit, might do that, a soft inquiry, which involves checking your own score, doesn’t harm your credit. Use Credit Karma to get a peek at your report. Having a good score is key to snagging a loan for your new house or business.

5. How much debt do I owe—and do I have a plan to pay it off?

Debt is arguably the top reason why people hate dealing with money — no one wants to look at those staggering numbers. These days, it’s a trap that’s hard not to fall into. College loan debt is on the rise, and whether you owe on that front or have credit card debt, it’s important to have a carefully budgeted plan for paying it off. That interest is out to get you! Pick an end date you’d like to have paid your debt by and create a strategy to meet it. Look into refinancing options if that will help. And if you owe both school and credit loans, pay off the credit first. It’s considered bad credit, whereas school loans aren’t.

6. How much interest am I earning on my savings?

This is a more fun question. The more dough you put away, the more interest you’ll earn on it — until a certain point at least. Shop around for a bank with an interest rate that best matches your saved figures. If you have $10,000 put away, you can move it to a high-interest online savings account that earns an extra one percent in annual interest. That translates to an extra $100 a year.

7. Should I invest?

If you don’t have much saved up, the answer is probably no. If you do, then the answer is probably yes — but only if you feel comfortable; it depends on how big of a risk you want to take. There are a lot of investment options out there with varying risk levels. See a financial advisor to determine an investment portfolio that best suits you.

8. What are my spending weaknesses?

Whether it’s Starbucks lattes or impulse shoe purchases, we all have our spending soft spots. Find out what yours are and then calculate how much it’s costing you a month and a year. Say you get a Tall Caffe Latte from Starbucks three times every week for the cost of $2.95. That’s roughly $460 a year. That’s a vacation for some! Puts things in perspective, doesn’t it? Every time you feel an urge to cave, think of the number you came up with and find alternatives to spending. In accordance with the Starbucks example, make coffee at home or drink the coffee at work instead. If you’re guilty of impulse buys, instead of acting on them, put the equal amount of whatever you were going to buy into your savings account.

Figuring out your money weaknesses will help you allocate your money to things that truly matter to you. Make a list of the top five most important things to you and organize your remaining budget on that. It brings a whole new meaning to investing.

9. Do I have a retirement plan?

You are never too young to think about this! The earlier you start, the better. Take advantage of your work’s 401K if offered. If it’s not, or if your company doesn’t match, look into opening an IRA. Do it now — even if you think you don’t have the money. Again, anything saved is better than nothing.

10. What are my financial goals?

Think both short term and long term. Is there a vacation in the next few months you’re saving up for or a dream home you want to buy in x amount of years? How much money do you want to save by the end of the year? Figure out what you want, implement a strategy, whether it’s automatic apps like Digit or lifestyle changes, and stick to it.
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What are some other financial questions do you ask yourself?