In order to build a skyscraper, you need to dig and set a good foundation. The same goes for financial freedom; you need a solid money foundation. It’s easy to fall into bad spending habits, but it’s never too late to go back to square one and rebuild. A solid financial foundation means that both you and your family are protected. Living a debt free life, with a healthy savings account, plus good life insurance policies means not having to worry about how your loved ones will take care of themselves in the event of your death.

Rebuild Credit

To start increasing your credit score, look for websites (like CreditSesame or CreditKarma) that will not only monitor your score for you, but give you tips on what you can do. Make sure you pay all your credit card balances on time. Look through your credit history to dispute any discrepancies that you find. Finally, if you have several accounts to manage, a debt consolidation loan with low interest may be the way to go to simplify your payments each month.

Eliminate Debt

If you have a lot of credit card debt, you want to make each payment count and decrease the principal (the amount that you have spent). By paying more than the minimum payment, you’ll be paying down more of the principal and reducing the amount of interest you’re paying in the long run. This concept of paying more than the minimum goes for all loans, not such credit card debt. If you have student loans or even a consolidated loan, paying more per month will ensure that you eliminate debt sooner.

Save for a Rainy Day

You never know what life may throw at you, whether it is layoffs, medical emergencies, or last-minute trips to see family members, having a savings and an emergency fund will help offset those expenses. An emergency fund should be about 3-6 months’ worth of expenses. Savings accounts can be for both short-term (such as saving up for a trip) or long-term goals. Having this kind of financial security not only affords you more choices in life but goes a long way to reduce financial anxiety and worry.

Protect Yourself

You’ve built up your credit score, eliminated debt, and started a savings account. The next step is to make sure your family is financially secure even after you’re gone. is a life insurance website that you can use to compare policies. You might think that you’re still young and there’s no need for life insurance, yet. However, in the event of your death, it’s important that your family has the financial security to cover funeral expenses and to continue to live debt free without your source of income. Similar to an emergency fund, a life insurance policy is a fund for your dependents.

Life insurance can also help give your family peace of mind if you become critically ill. In the event of a terminal illness, you are not expected to continue to work and the loss of income is an added stress on top of everything else. Some policies will be able to pay a lump sum to your children after you pass, while others can give them a monthly payment for 15-20 years. Knowing your options and being able to compare policies is the last step to achieving a solid money foundation.

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