The linked Money Buffalo video discusses financial resilience, from inflation and cash flow to debt, emergency savings, diversification, and regular investing. Use these six prompts to review your finances; adapt them to your own circumstances.
1. Review cash flow, assets, and debt
List money coming in and going out. Identify which items create income and which require payments. This cash-flow lens can help you start reviewing assets and liabilities, but it is not a complete accounting definition of every asset.
2. Consider how inflation affects purchasing power
The video uses inflation to illustrate how the purchasing power of cash savings can change over time. This does not mean you should invest all emergency savings: money needed soon still needs to remain accessible.
3. Stop adding debt and prioritize repayments
The video suggests avoiding new debt, addressing high-interest balances, and reviewing larger loans such as a mortgage. Before making extra payments, compare the interest rate, fees, early-repayment terms, and the cash you need to keep available.
4. Build an emergency reserve
An emergency fund can help an unexpected expense or income interruption from derailing a long-term plan. Choose a target based on essential expenses, family responsibilities, income stability, and coverage you can actually use.
5. Diversify and invest consistently
Diversification can reduce reliance on a single type of asset. Dollar-cost averaging (DCA) means investing a similar amount at regular intervals. Neither diversification nor DCA guarantees a profit or prevents losses; consider risk, fees, and the time horizon for each goal.
6. Define what financial independence means to you
The video frames wealth in terms of freedom and security, including a point where income from assets can cover expenses. Treat this as a planning goal, not a guaranteed formula. Use your income, expenses, and time horizon to make the goal more concrete.
This checklist is general financial education, not an individual investment recommendation. Read our summary of the related Money Buffalo video for another guide to the same discussion.