5 financial behaviors to boost your financial health

57% of households are saving for 3+ goals.²

Sticking to a budget is an important step if you're planning to put your money toward multiple goals. Over the past 2 years, inflation has put a strain on budgets, making it harder to pay down debts and save. One technique that can work as a helpful budgeting guide is the 50/30/20 rule. Give it a try to ensure you're setting aside money to efficiently pay off debts and save.

Whether you're saving for a child's education, a down payment on a house, your retirement, or something else, it's important to turn your goals into an investment plan. A simple way to get started is to automate your savings by having money automatically transferred into your account on a set schedule.   

Many investors are prioritizing strategies to efficiently pay off high-interest loans.

When inflation and interest rates are high, it's important to focus on paying off debts with high interest rates first. But for debt with a comparatively low interest rate, it's a good idea to compare the debt's interest rate against the rate of return you hope to achieve with your investments.

Here are some tips to help you:

• Build an effective plan to tackle debt.
• Determine a payoff strategy that works to minimize total interest paid or get some quick wins under your belt.  

Creating a financial safety net for unexpected expenses has become a top priority for Americans. In fact, 52% of U.S. households prioritize building an emergency fund as their top goal, even as they juggle the demands of multiple goals.²

To maximize your long-term growth potential, consider splitting your savings between cash and investments. For example, investing a portion of your emergency savings in an accessible, broadly diversified ETF (exchange-traded fund) with minimal tax consequences can help you keep up with inflation. These supplemental savings could come in handy if you lose your job or experience a break in your income.³

Learn more about our approach to emergency savings.

Investors are actively seeking tax-efficient strategies to minimize their tax liability. This includes using tax-advantaged accounts such as IRAs and 401(k)s to shelter their retirement savings from the regular pinch of taxes through tax-deferred growth.⁴ Automated tax-loss harvesting⁵ is an effective tax strategy that can help turn market volatility into a tax-savings opportunity. 

Market volatility is a normal, expected part of investing. And it's a big reason why so many investors hold a balanced portfolio of stocks and bonds.  

While you can't predict when volatility will strike, there are things you can do to help stay on the path to long-term success. It's about focusing on things within your control like:

• Diversifying your portfolio. Investing across different asset classes, sectors, and geographical regions can help reduce the impact of market risk on overall investment returns. ETFs or funds that seek to track broad market indexes offer a great way to get broad exposure to the entire U.S. and International stock and bond market.
• Rebalancing your portfolio. When one asset class is doing better than others, your portfolio could become unaligned with your target asset allocation. To ensure your portfolio stays aligned with your risk tolerance and asset allocation, we recommend checking it at least once a year. And if your mix is off by at least 5 percentage points, consider rebalancing so you don't drift off course.