This article was written for our sponsor, Consumer Education Services Inc.

Seven in 10 Americans struggle with some aspect of financial stability, whether it be starting a savings account, managing bill payments or curbing spending habits.

A 2017 survey from Bankrate revealed more than half of Americans don’t have enough money saved up to cover a $500 expense. For many people, that means unanticipated car repairs, unexpected medical bills or major housing repairs could be enough to put them over the edge financially.

It’s important to note the constant stress of an insecure financial situation can really take a toll on other areas of one’s life.

“Studies have shown that employees who are struggling with their finances are less productive at work,” explained Jean Elias, vice president of marketing at Consumer Education Services Inc., a Raleigh-based nonprofit credit counseling agency. “Financial stress often leads to physical and emotional stress that can ultimately have a negative impact on health. When you’re wondering how you’re going to pay your rent or your mortgage, it affects many areas of your life, including the choices you make.”

While many people allow finances to control their life choices, it is possible to take back control and pave the way for financial health. The following five tips can help individuals practice financial wellness and prepare them for the challenges life may throw their way, while also maintaining financial stability.

1. Understand Where You Are Now and Where You Want to Be

An excellent first step to establishing financial wellness is to set clear, measurable financial goals.

According to Elias, one of the most effective places to start is to pick one specific longer-term financial goal you want to accomplish (homeownership, debt reduction, et cetera) and focus your short-term actions toward the realization of that goal.

When it comes to financial health, this means it’s important to understand your cash flow and your savings before you begin.

“At CESI, we help people establish a financial baseline by walking them through the creation of a budget and action plan,” said Mike Croxson, CEO of CESI. “We understand some people may feel uncomfortable talking about their finances and they would rather try to figure it out on their own. The key is to provide the consumer with options that can help them; and at CESI, we do just that.”

2. Know What You Owe

A key aspect to achieving financial health is tracking exactly how much you owe. One of the best ways to do this is by accessing your credit report to get a clearer understanding of the whole picture.

Resources like annualcreditreport.com can help with this at no cost. For those in need of a little more guidance, CESI offers access to financial counselors who can review debt and credit information and talk over exactly what the numbers mean.

“CESI offers a free financial assessment in which credit counselors who have been trained and certified by the National Foundation for Credit Counseling are able to go over the whole financial picture, discuss goals, and then help people walk through a process of addressing their debt,” Elias explained. “A lot of times, people feel stress and anxiety about their overall debt picture. They may have multiple sources of debt weighing on them. It’s important to lay everything out and understand the whole picture so you can get clarity and create a plan for success.”

Knowing your total debt will also allow you to calculate your debt-to-income ratio, which will paint a clearer picture of how much money from your total income actually needs to be set aside to contribute to debt reduction.

According to credit.com, an ideal DTI ratio is at or below 36 percent, with 45 percent considered a maximum. If your ratio is high, experts like the ones at CESI can assist you with ways to lower it.

3. Create a Budget and Stick to it

Creating a budget is one of the best and simplest ways to keep on top of your finances.

It’s easy to swipe debit and credit cards without realizing how much money is being spent. Keeping track of exactly how much money you’re earning versus spending seems like a basic concept — but it’s one that really works.

There are plenty of ways to create a budget. While apps like Mint and PocketGuard can help you keep track of your spending, others find the “old-school” pen and paper route or creating spreadsheets works better for them.

However you decide to budget, the key is figuring out how much you earn in a given time period and then creating a plan to not overspend.

Experts typically recommend figuring out all of your monthly bills and expenses (rent or mortgage, electricity, food, transportation, et cetera), then setting parameters for things like incidentals, entertainment and other non-necessities. Once your budget is created, you can look at areas where you can potentially trim expenses, and if you have money left over, allocate it toward savings or other financial goals.

“Many banks offer free resources for their clients that will give you a visual on where your money is going,” Elias mentioned. “If a large amount of your spending is going toward expenses that are discretionary or optional, and you are struggling with debt, this is an opportunity to evaluate your spending against the financial goals you have established, and adjust your spending to achieve your goals.”

For many people, entertainment is an area that can become a slow leak in their budget — things like going to the movies, grabbing drinks after work or ordering takeout. If you’re having trouble sticking to your budget, this is the first place to start looking for excess spending.

Another hidden expense? Using credit and not paying the entire balance at the end of the month. It’s easy to think of credit and debit as one and the same — but excess use of credit without paying it down will cost you more in the end.

“Using credit to pay for something that should be accounted for in the household budget is going to cost more every time,” Croxson said. “Oftentimes people don’t recognize how high the cost of using credit can be. It’s not a big deal if you pay the full balance on time, but if you don’t, you owe more than you borrowed, and that pizza that you bought at Domino’s for $10 will end up costing you far more.”

One of the most helpful ways of getting a full picture of what you owe is to dust off your records and complete a “spring cleaning” of your finances, reviewing everything from cell phone bills to average utility costs. From there, you can trim back on some services — and maybe even negotiate cheaper packages with a few of your providers.

When you make even these small changes, the savings start to add up.

4. Pay Yourself First

When you receive your paycheck or extra income, it can be tempting to direct all of it toward your outstanding bills and loan payments. While doing so may seem like a logical move initially, not allocating some of your income to savings can weaken your financial future.

It’s more useful for both your short-term and long-term financial health to set aside a portion of your money for an emergency fund.

Consider checking if your bank offers an automated savings program. That way, you can enroll and choose a fixed amount to set aside on a monthly basis, essentially removing the opportunity to spend it before transferring it to your savings.

Additionally, some banks — and even apps like Acorns, Chime and Qapital — offer technology that rounds up your debit and credit purchases to the nearest dollar, then places the spare change from the roundup directly into a savings account. For many, it’s a way to incrementally increase savings habits without even thinking about it.

If your employer offers a matched 401(k) contribution, make sure to take advantage of all of the money offered by contributing toward the maximum match to invest in your financial future.

5. Know What Resources Are Available

Knowing what resources are available to you and taking advantage of them can turn your financial health around. Whether by consulting online resources or talking with a credit counselor and getting guidance, there’s a model for every preference.

“Credit counseling can be done with a certified counselor online, in-person or over the phone, and there are resources available to help you throughout the process — it’s kind of a DIY model,” Croxson said. “There are options for people to get access to help they need based on how they like to learn and work.”

Bills won’t disappear overnight, but by making small changes, you’ll be setting yourself on the path for future success.

“You can’t expect that the first steps you take are going to get you to the finish line. There’s an incremental approach to it,” Croxson explained. “It really is about setting small goals and proving to yourself that you can do it — it may not always be a painless process, but when you start to see progress, you build excitement and motivation to keep moving forward.”

Financial wellness is a marathon, not a sprint. It does not happen overnight and requires training yourself to adhere to healthy habits — but crossing the finish line is possible.

This article was written for our sponsor, Consumer Education Services Inc.