Become Financially-Savvy One Step At A Time

How well do you manage your money? Being ‘poor with money’ is a common flaw in individuals, but is something that you can fix over time. Whether you have debts to pay, want to increase your savings or simply stop wasteful spending, it’s time to change your ways. A step-by-step approach is the best way to become better with your finances, so take a look at these great ideas for becoming more financially-savvy. 

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Step One: Get to know your current situation
Do you know what the balance of your checking account is? What is your monthly salary to the cent? It’s important to have a clear picture of your finances to make sure that you know exactly what’s going on. Start by writing down all of your outgoings, your income and analyze your weekly spending to give you a better idea of where you are financially. Doing this might reveal some things you’d rather not know, but your finances will be much better if you know what’s coming in and what’s going out.

Step Two: Start a budget
Whatever your financial goal, a budget can help. From helping you save more each month, to clearing your debts, a budget will determine what you can spend each month after your bills and other expenses are paid. While starting a budget is easy, sticking to your budget is difficult. Create a budget that is manageable and doesn’t completely deprive you of the things you love. 

Step Three: Take care of your debts
Debts can spiral out of control, but if you take action before things get too serious, you can help yourself to get out of it. Make a plan of how you’re going to pay your debts each month, starting with the ones with the most interest. There are ways you can get out of debt faster if you are willing to make some sacrifices, which will certainly be worth it to help you regain control of your finances.

Step Four: Improve your credit rating
Your credit rating is important to help you apply for a mortgage, a credit card or loan, and the better your score is, the better the deal you will get. When you read about using credit cards to improve your score, you probably think it’s counter-productive, but putting your regular spending on your credit card and paying the balance back in full each month is actually a simple way of achieving a better score. Always pay your bills on time and make sure you don’t spend more than you can afford to pay back.

Step Five: Start reading personal finance news
One of the reasons why many people are bad with money is that they don’t really understand it. Personal finance news can tell you a lot about things like interest rates, where the best savings are and how to avoid bad deals. Forbes is a great place to start to look at personal finance news so that you can start building up your knowledge to secure the best rates and best offers.

Step Six: Be more thrifty
If you’ve always spent your money as soon as it’s come in, it might be time to change things around. Being thrifty is often met with negativity, but a thriftier lifestyle can help you eliminate some of your poorer spending habits and replace them with good ones. Even simple things like saving money on your grocery bill will make a big difference to how you spend money, so start looking at ways to change. When it comes to shopping online, there’s always a deal to be found to help you save money, so never accept the first offer.

Step Seven: Cut back on waste
Wasted electricity, wasted food, wasted gym membership… when you think about it - there’s potentially a lost of waste in your life! By eliminating waste, you’ll not only be saving money but helping the environment too. Meal planning can be a great way to cut down on food waste, ensuring that you only by what you need while also helping you shed some pounds - sounds like a win-win! Meanwhile, finding ways to reduce your electricity bill, such as unplugging all appliances at night, using less heating, etc. can also help you to reduce your monthly outgoings while also contributing to fixing a global problem.

Step Eight: Set some savings goals
There’s always something worth saving for, and whether you’ve got a new car, a vacation or a designer bag in mind, it’s good to have something to aim towards. With a savings target in place, you can work towards something instead of adopting the ‘got to have it now’ attitude. Start off with some smaller goals and then work towards bigger ones as you become savvier with your savings.

Step Nine: Invest your money
If you want to think about retiring early, or living more comfortably, then investing is the way to go. If you’ve never invested in anything before, there is great advice on investment for beginners to help you get started. You could invest in property, a startup, the stock market and more to help you grow your savings, providing you with a comfortable nest egg for your future. If you’re unsure about where to start, it helps to speak to others about investments to learn more about the options that are available to you.

Step Ten: Stay positive
It’s easy to feel disheartened when your finances don’t fix themselves overnight, but the important thing to remember is not to give up! Finance can be stressful, but you should aim to banish stress from your life for the sake of your mental health. If you have a setback, take some time to reflect on things, before picking yourself up and starting over.

Whatever your current financial situation, making an effort to take better control of your finances will benefit you. Save yourself the stress and uncertainty of managing your money by following the steps above to become more financially savvy, and enjoy a stress-free money future.