Looking into making smart moves with your money? Not an easy journey to start but a great one that will be very beneficial. Learning to manage your finances will help you get more from your money. Finances can involve emotions and stress but it gets better in time when you make a habit of it and start seeing all the positive outcomes. Here are some tips to manage better,
1. Create a budget
First things first and budget is number one on the list and most importantly stick to it. With a budget plan, you will always know how you spend your money and be guided if you spend it well or not. Budgeting is a very crucial step that needs to be taken seriously to help you gain control of your money. If you don’t know how to draw up a budget you are not alone, ask for help. With a budget, you know where your money goes.
2. Be clear with your debt and track your net worth
Write down every single debt you have and payment plans you have in place. Never leave anything behind including those debts that you believe are too small to note. The total amount of your assets minus the total amount of your debts is your net worth. Is it looking very worrying? Don’t stress because we all have to start somewhere and with dedication, it can be done. Keeping this record will help you work in improving your net worth.
3. Avoid more debt and pay off existing one
Look into your list of debt and start paying off small ones first. When all that is done and dusted do not use the extra money for shopping rather put more into paying the bigger debt to cut on the interest rate. Check which one has the higher interest rate and start paying it first.
4. Create a savings plan
The key here is to have savings account that you cannot easily dip into. If you can easily dip into it from time to time it will serve no purpose. Plan on how much you will save each month and remember to stick to it
5. Pay yourself first
The good strategy here is to pay yourself first before you start with your needs and your wants. Save first then spend later, never spend the money and save what is left.
6.Check your impulsive expenditure
Learn to have very deep pockets that are difficult to reach when you have to spend unnecessarily. Impulse expenditure is the “get broke quick scheme”. Keep your money and do some thinking before you blow it.
7. Cut your expenses
Review every single thing you spend your money on, on a monthly basis. For example, if you eat out 4 times in a month, cut it to 2 times. If you are renting check out cheaper options and review the shopping list as well, take out the unnecessary wants and leave only the necessities.
8. Increase your income
There are several ways to boost your income, it can be negotiating a raise or starting a side hustle that will bring another income. Multiple ways of bringing income are the best way to bring financial freedom.
9. Resist lifestyle creep
The moment your income increases and you also increase your spending, that’s lifestyle creep/inflation. Ooh, I got more money so I can buy a new car, move to a better place, eat out daily, go shopping more, STOP. This kind of behavior and thinking will be sabotaging yourself and your finances. Avoid dramatic changes because the end results might just be suicidal.
10. Get financial education
Invest in yourself and be financially educated. Learn more on savings, investments, interest rates, compound interest, the difference between assets and liabilities and create your financial goals. You will be amazed how you can turn into a master of your finances by following rules and sticking to your plans.
11. Set financial goals
When you have learned about finances you can now set specific goals. Be clear on what the goal is, the exact amount you need to save for it, and give it a time frame. If it is a debt you want to pay off, set a specific date you want to accomplish that. Set realistic goals.
12. Compete against yourself
Be your own competitor, it is for your own wealth and financial freedom not to be better than the next woman. Focus on your situation, run your race at your own rate and you will reach your beautiful destination.
13. Learn self-control
You need to stay in control and be self-disciplined. You cannot rely on someone else to stay focused on your goals. Be your best coach and mentor because everywhere you go and every decision you make you will always have you to remind yourself to make the best decision. By doing this it means you love and value yourself.
14. Get a financial friend
Does it all sound too difficult? If you need some motivation and support, consider getting a financial friend or a money buddy. Be very careful how you choose your money buddy. Go for someone who has good financial habits, who will complement your areas of difficulty, and commonly understands your financial situation. If you can’t find one you can join a club or start one.
Most important, savor every moment. Enjoy and be happy with what you have now while you’re on the journey to acquire much more. Financial knowledge is power and it can build you generational wealth if you apply it. No need to keep up with anyone or anything you only need to focus and do your thing.
**IT IS NOT ALWAYS ABOUT HOW MUCH YOU MAKE**