By now, you have probably started with your resolutions this year. How’s it going so far? Aren’t you forgetting anything you should also wor...
By now, you have probably started with your resolutions this year. How’s it going so far? Aren’t you forgetting anything you should also work on this year?
That’s right, how’s your financial situation going and how do you plan to improve it? Managing your money situation is actually second to health and wellness when it comes to new year’s resolution goals.
Talks about money can be really stressful let alone deal with it real time. If you’re still clueless on when and how to start getting your finances in check, we’re here to help you out.
So you may be asking, “When should I start getting my finances right?”
Thinking how to do it? Check out the guides below and take note for it should be your checklist to reaching your success in handling your finances.
Start with breaking down your budget
No one starts to run without learning how to walk. Before you begin taking actions, start from the basics and work your way to getting things right and then you’ll be able to save and put your money issues behind with ease.
Identify your net worth. Determine your assets such as your salary, savings, investments and subtracts your debt from it. Now that you have your total budget, you should have an idea on how to handle your expenses such as electricity, rent, water, mobile data and other utilities.
The result should also be where you want to focus on maximizing in order to get a clear view of your current financial state. By doing so, you get a better look on how you must budget your priorities and pay off your debts.
Identify your priorities
After your break down your total budget, don’t just start allocating amounts of money for each category expenses - determine your priorities first. Why? Because allocating a larger amount for your leisure and entertainment than your utility bills is a move backward that can pull you to a downward spiral.
Do set your priorities straight and deal with the necessary expenses first and for your savings as well before you spend the extra for your luxuries. A quick and simple guide: know your wants vs needs.
Set realistic goals
This is where most people get it wrong about handling finances; they don’t set realistic goals. Yes, it’s easy to say and write down that you want to save at least $30,000 by the end of the year but can you truly achieve it and is it doable?
It’s even better if you start reaching small goals that contributes into reaching your big and ultimate goals as long as your setting doable goals for yourself. Your net worth is as is and you can’t really stretch it big enough to reach an absurd and unrealistic goal.
Track your expenses
Now that you have determined your concrete budget, have set up your priorities and identified your goals, time to start tracking what goes in and out of your wallet; the same goes for every swipe of your credit card.
Grabbed a mocha latte on the way to work? List it. Got to pay off your small debt to a friend? Write it down. Much like the importance and essence of counting your calories to lose or gain weight, it’s a must to also be mindful of your expenditures to be able to track your overall progress. Also, having it noted down will make you think twice on spending more on coffee or making your own at home.
Check your credit
Let’s not forget about your credit cards. You know, it could be one among the factors that causes you to spend more than you have and be burdened in more debt than you know. It may seem like it but the cashless transactions of credit cards may make you feel as if you have unlimited money; with just one swipe, you can pay for what you want or need.
Make on-time monthly payments to reduce interests and limit yourself from using your credit from now on. In addition, do check your credit card statement frequently to get a glimpse of your transactions.
Pay off your debts
Most especially your expensive debts. If you resorted to taking credit card loans or loans from service lenders a million moons ago, try to pay them off the soonest you can.
Make goals on how you should pay them. For instance, save up for your credit loan and pay them off by the time of the month. These loans and other debts is a burden and if you don’t deal with them immediately, it will affect your finances for as long as you don’t pay them off. Plus, the longer you repay the debt, the higher the interest gets.
>> Also Read: 5 AWESOME WAYS TO FREE YOURSELF FROM NOTORIOUS DEBT
Configure your mindset
If you don’t get your head on your money mindset, you won’t make lasting progress and as a result, you might only fall back to your bad money management habits. If you don’t fully commit and discipline yourself to do this, you won’t reach your goal.
Act on it
Don’t just take down these notes and do nothing afterwards, put these into action! You’ll never make a change if you don’t act on your goals and don’t set your mind to it.
Make real progress as you go on your financial journey and keep the streak going on the right path. No shortcuts and wrong turns, just follow the directions and go straight ahead. If you set up and committed to an effective practice, you’ll have little to no problems in handling your finances.
Are you frugal-minded and great at handling your finances? Share us your best advice!
About Chie Suarez:
Chie Suarez has spent time figuring out ways on saving money and stepping away from her go-to retail stores. She then became a writer for Speedy Money which offers hassle-free payday loans services.