Managing your money can be hard because it requires diligence, determination, and focus. That’s why so many people forgo a plan and spend the money in their checking account until it’s gone instead!
Although it may be easier to think about your finances as they pertain to your daily life, it’s much better to take the time to develop a wider view of your money. These tips will help you do just that.
1. Organize Your Financial Accounts
For some, better money management means opening multiple accounts with various goals in mind. For others, it means organizing the accounts you already have!
If you’re saving money in more than one place, it’s time to organize your financial accounts. That might mean utilizing cap table software through your employer, it could mean going through your paper files and keeping all of your account information in the same place, or it could mean hiring a financial planner to organize and maintain all of your financial information for you. They can also develop a plan to help you attain your financial goals and guide you in fulfilling your financial needs.
Typically, it doesn’t really matter exactly how you organize your financial accounts. What matters is that they are all organized in a way that you understand, and you’re able to manage your finances a little better.
2. Automate Savings
You know you need to save, but that doesn’t mean you save the way you should. It’s easy to make a plan to save what you have leftover at the end of the month, only to discover there’s nothing left at the end of the month to save!
Make sure you’re putting money into your retirement accounts, rainy day funds, and other savings accounts by automating what you deposit each month. A few ways you can do that include:
- Save your tax refund every year
- Schedule an automatic deposit
- Split a direct deposit
- Use a cashback credit card
There are many other ways to save too! You can use apps that will round up your purchases and put the change into a savings account, for example. Saving the old-fashioned way is a great option too. Empty your pockets and put any leftover change or cash in a jar that you can save for an emergency.
Remember, no matter what automated method you use, saving money comes with discipline and determination. If you’re disciplined and determined to set aside a portion of your monthly paycheck, you’ll be able to save some money and handle your finances much better.
3. Pick the Right Bank
Most people have a bank account, but is your money with the right bank?
Many people simply use the bank that’s right down the street, while others may have been with the same bank for so long, they haven’t even considered the possibility of transferring their money to another bank.
Although moving your money can be a pain, it’s important to do your research and choose a bank that’s right for you. You’ll want to look for a bank that reduces or eliminates fees, but with some digging, you may also find a local credit union that pays its members. You might want to choose a bank based on their loan options, or convenience might be top-of-mind if you travel frequently. Assess what’s important to you and find a bank in your area that offers those services. You can do this by seeking some referrals from family, friends, and colleagues or by searching for some prospective banks online. Whatever method you use, finding the right bank can help you manage your money more effectively.
4. Create a Budget
If you’re flying by the seat of your pants when it comes to your bank account, you’re doing yourself a disservice. You’ll always find yourself with an empty bank account at the end of the month because you’ll just keep spending until you can’t spend anymore.
Instead, take the time to create a budget. Start with your total monthly income. Then, list both fixed and variable monthly expenses. Subtract your expenses from your monthly income to see what you have leftover. Based on what’s left, you can decide how much you want to put into savings every month.
Even if it’s hard, it’s important to get real about the money you have coming in and the money you have that’s going out. Getting real about your budget is the only way to make sure your money is working hard for you and your family. Otherwise, you end up facing urgent and unexpected expenses without financial resources to cover them up.
However, even if you have a tight budget, you may still be able to manage your finances during emergencies by taking out same day loans from reliable lenders online. These financial solutions provide you with short-term funding to shoulder unplanned expenses that your monthly budget doesn’t cover. But aside from loans, having an emergency fund may also help you navigate your finances a little better when an urgent situation arises.
5. Track Your Spending
Once you have created a budget, you should track your spending to see how well you stick to your budget. If you find that you’re spending more than you initially planned, you may want to get creative about how you track your spending.
For example, you may want to track how much you’re spending at certain stores or what kinds of things you spend a lot of your money on, like clothing.
Prevent yourself from overspending by creating a separate spending account. When it’s empty, it’s empty until your next paycheck. Avoid the temptation of spending money beyond your budget if you’re looking to manage your finances a little better.
6. Eliminate Debt and Fees
Managing your money means more than just figuring out how much money you have coming in and what you’re spending it on. It means more than saving for retirement too.
Debt comes with high-interest rates, and sneaky fees can drain your bank account when that money would have been put to better use somewhere else.
Get creative about how you can reduce or eliminate your debt. Don’t overdraw your account and eliminate monthly services you don’t need to reduce fees. Also, there are other ways to help you get out of debt. These can include paying more than the minimum amount due, spending less than what you intend to spend, and paying off the most expensive debt.
By considering any of these methods, you may be able to minimize or settle your debts in no time.
7. Have Fun With Your Money
It’s important to have a plan for your money, figure out where you want to put it, and stick with your plan, but don’t get so wrapped up in spending less and saving more that you forget to have fun with your money!
It’s important to save, but ultimately, money is for spending. You deserve to have fun with your money when you’re being careful about your budget.
Determine how much you want to spend on things like eating out and entertainment so you can do a few fun things each month. You may also want to consider creating a long-term savings account. That way, you can save for big-ticket items, like a designer handbag or a vacation.
If you find yourself with an empty bank account at the end of the month, if you don’t have a rainy day fund, or if you aren’t thinking ahead to retirement, you’re not managing your money—it’s managing you! Flip the script with the tips on this list, so you spend every cent exactly the way you want.