2020, the year that took us by surprise. While we’re trying to move forward in 2021, there is something to consider about the year the pandemic arrived on our shores. Were you financially prepared?
Unexpected job loss, lowered incomes, and job furloughs were all a part of last year’s challenges, so now as circumstances start to improve, and global hope is increasing, it’s time to consider your personal finances and take control of them. Here are five top tips to help you succeed.
Invest your money and save
A highly important part of managing your money is knowing where to put it. While paying bills and life expenses is first and foremost, the money you don’t need to cover bills should be going somewhere safe. Most people choose to save extra money for rainy days and this is wise, but investing is also another way you can “save” while earning more. Whether you choose to set-up a savings account, invest in real-estate or 401k, financial professionals like Cetera investment services can help you determine where is the best place for you to put your money.
Make a spreadsheet or use an app to budget
Make a spreadsheet to plan your budget or use one of the many available apps out there to take control of what you make and what you have to spend. When making a monthly budget, it’s important to be thorough and consider calculating more than what you actually pay for bills. A comprehensive budget will include everything from fixed costs (like your rent, phone bill, etc.) to your savings and investments, as well as an estimate for food and groceries.
While you want to cover all the basics and necessities, also include an estimate of what you would like to spend on extra stuff, like entertainment and outings. Having a budget that you stick to makes it much easier to reach financial goals.
Cut spending and track your expenses
Along the lines of having a budget, you’ll want to keep track of your expenses so that you avoid overspending. This is undoubtedly one of the most challenging things for people to do, as it does take discipline. To simplify the process, consider using an app that allows you to connect to your bank accounts and keeps track of spending for you. You can also use a scheduling app like Square Up that makes it easy for you to see when big bills are due and helps you keep an eye on your money and payments.
Do you have debt? Pay it off
Putting off debt for too long is not good for anyone. From building your credit to achieving financial goals, the presence of debt can make it difficult for you to progress. The thing is, almost everyone has debt. Whether you have student loans to pay off or even just too much credit card usage, making a plan on how you will pay off your debt should be your priority. Being free from debt allows you to own your money and no longer have the crushing weight of debt anxiety hanging over you.
Make more money
Whether you have debt to pay off or want to invest and save money, can you achieve these goals with your current income? While the job market might not be the best at this time, consider starting a side hustle or find a job that pays well in order to take control of your finances and reach your goals. It may not be your favorite thing to do, but temporary discomfort to achieve financial success may be worth it.
Final Thoughts
Taking control of your personal finances may not be easy at first but it’s worth it. Financial freedom and stability is worth the small sacrifices you may need to take to get there. Whether you work with a financial professional or start budgeting and tracking expenses at home, your efforts will pay off.
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