There’s no doubt in anyone’s mind that it is absolutely essential to properly manage personal finances. Whether you’re saving for a rainy day, making sure you’re covered if the car breaks down or the washer breaks, planning a vacation, budgeting to pay off credit cards, or trying to make significant investments like buying a house, knowing how to manage your money is essential. While not everyone needs to use smart finances to get out of debt, absolutely everyone wants to know how to make the most out of their earnings, and enjoy a higher quality lifestyle, that is stable and financially secure. The following tips aren’t published in a book anywhere, and they’re not something we teach in school however they are points that everyone who is savvy when it comes to savings, investments and outgoings are well aware of.
1. Stay On Top Of Interest Rates
This may be easier said than done, as many families have mortgages, loans, credit cards, and car payments to balance out every month. However, when you have time you can save yourself significant amounts of money every month by paying off higher-interest debts faster than others, and making sure you’re aware of when you can switch to 0% interest credit cards or mortgages. Interest can eat up you salary, and you have nothing at all to show for it.
2. Mark It On Your Calendar
Those days when payments are due, or taxes need to be filed should be as regular on your calendar as other daily necessities. This is a basic thing to do that ensures you never miss a payment and are completely in control of all your finances. You can tell straight away if something isn’t right, and won’t end up running around trying to pay everything at the last minute, or dealing with late fees.
3. Set Real Goals
If you have a dream vacation, or car, or plans to renovate your home, you should be vaguely aware of the costs involved. Figuring out the exact costs and how much you would need to save every month in order to realize these goals can be a great step in restricting wasteful spending. Many people don’t even realise how much they spend a month on take-out, restaurants, cable TV or even small purchases like buying lunch at the office canteen instead of taking their own. You may surprise yourself with how much you can save when you suddenly have a reason to stop spending on unimportant items.
4. Commit To A Savings Account
Nate Mackinlay, a financial manager from Best Australian Writers, says that ‘most people don’t realise how much they can afford to save.’ While many of us are able to account for 90% of our earnings, between housing, groceries, the gym, and a social life, there is often a final 10% that just disappears. However that last 10% is spent, you can normally find it by writing down every single purchase for a month. At the end of that month you can then normally see that 5-10% of your income could go into a savings account, if you just stopped unnecessary purchases.
5. Get Rid Of Your Cards
Dozens of experiments and personal stories show that it’s much easier to save money and stop unnecessary spending by using cash only. This means that you actually see your finances dwindle with every purchase of a few dollars, and you could be surprised by how much you’ve spent at the end of the day.
6. Stay Positive
If you’re walking around telling people you’re bad with money, can’t save up, and will never have savings, then that is exactly what will happen. Find a way to adopt a good mental attitude, tell yourself you can do it, and treat saving up as a form of self-love – you’re taking care of yourself, your future, and your dreams simply by putting down a spare lipstick or pair of designer trainers.
7. Don’t Be Shy About Your Value
One of the best ways to have more money is to make more. Don’t be afraid to negotiate for better pay, a better job title, or even a promotion, maternity or paternity pay, overtime, or bonuses. When you know you are a good employee, you deserve to be valued, and you should be paid for the good work you do.
8. Don’t Cut Out Treats Altogether
While many of us could cut back when it comes to take out, clothes, and other indulgencies, completely depriving yourself is not the way to go. It’s not feasible and you won’t stick to your new plans if you’re miserable. Try to cut back, rather than completely stop buying yourself the small things that make you happy.
There’s no easy way to have everything you want, and never have to think about money. However, implementing the above tips can radially improve your financial situation with very little effort.