Five Money Management Hacks to Improve Your Finances
With the cost of living increasing steadily, people are looking for ways to tighten their belts and improve their finances. Although there are many ways to build incidental savings including putting loose change in a jar, it’s the larger tactics that are going to have the most impact on your future finances. If you need a nudge in the right direction, continue reading for our money management hacks to improve your finances.
Start Budgeting
You have no chance of improving your finances without putting a proper budget in place. The best way to start budgeting is to build a financial buffer and avoid living paycheck to paycheck. When you’re in this situation, it will feel impossible, but you just need to put in a few extremely strict months. Having a buffer in place will account for life happening, including car breakdowns and home emergencies.
With your buffer in place, it’s time to implement a budget, which involves splitting your incoming cash between your financial needs. As a benchmark, it’s suggested that 50% of your income will be assigned to the cost of living, 30% to your desires, and 20% to savings.
Address Any Debt
When you’re creating a budget, your primary focus should be on clearing any debts, as these will hinder your credit profile. Work out an amount that suits your income and pay it off regularly – setting up a standing order is a great way to avoid missing payments. If your debts are to companies, instead of credit cards, you should communicate with them to figure out a workable payment plan without risking additional costs.
Having many different loans can be confusing and will likely lead to missed payments. Therefore, we recommend consolidating your debts into one loan, which you can easily keep track of. Doing this will help improve your credit rating because you’ll have fewer loans against your name.
Automate Savings
If you struggle to put money into savings, consider using your online banking app to schedule automatic savings. The best day to put money away is payday, so schedule a small amount to exit your bank as your income enters. If you never had the money, you won’t feel as though you’re saving.
Explore Investment Opportunities
If your financial goal is growth, we recommend exploring investment opportunities including crypto, stocks, and forex. By researching your chosen market and investing carefully, you can grow your finances considerably. When you start out trading stocks you’ll need support, which is why we recommend reading this page on getting started with the stock market.
Save on Monthly Bills
There’s no point in spending more money than you need to, so go through every single bill and look for ways to reduce it. If you have bills that are slightly too high, get in touch with the company and see if you can spread the cost over a longer period. Remember, if you don’t ask, you’ll never get it.
While paying less money for finance plans is great, there’s no point having subscriptions hanging on that you don’t need. For example, if you’re still paying for the gym that you’ve been to once in the last month, get rid of it. If you’re paying for Netflix, Disney, Amazon Prime, Hulu, and HBO – just choose one of them. After all, you can only watch one film or episode at a time.
Improving your financial well-being can be challenging, but it’s never impossible. Make sure you put a budget in place and you’re walking in the right direction.
