Managing your money can really help you stay on top of your bills and monthly expenses. Financial stability is one of the major contributing factors towards a healthy and happy life. Managing your money can help you save a good amount every year.
You can use this saved money to keep you away from the debt cycle and deal with emergencies. So, here are few financial tips to stay on top of your finances efficiently:
1. Financial Reminders
Technology has helped tremendously in every field. Finance is no exception. Forgot to pay your monthly taxes and bills? Technology is your saviour.
You can put reminders for your monthly payments and save yourself from the monthly mess. It will be helpful to create a financial calendar and put reminders for all your monthly payments.
2. Assess your Net Worth
It is essential to check your net worth, i.e. the difference between your assets and debt, to get a clear picture of your financial standing.
Your financial standing will help you set your future financial goals and keep track of your finances.
3. Budget setting
The first and foremost step to have a financial standing is to set your budget. It can mix both your monthly income and extra earnings like borrowing funds with loans for benefits.
4. Take a Daily Money Minute
It is advisable to take out one minute every day to keep a check on your financial transactions.
Regularly monitoring your financial transactions helps to identify any loophole or problem in the system. Also, it helps to keep track of your future financial goal.
5. The 20% rule
An emergency can happen to anybody and anytime. It is vital to building up an emergency fund to stay tension free at the time of any urgent need.
You can follow the 20% rule, i.e. keep aside 20% of your income for your emergency fund and stay financially safe. This will help you guard against any financial constraint and keep you on top of your finances.
6. The 30% rule
As mentioned above, you must save 20% of your total income for your emergency fund. For other lifestyle expenses, you can follow the 30% rule.
This will help you segregate your expenses without any confusion. Your lifestyle spending may include restaurants, movies, play areas etc. By following this 30% rule, you can save and enjoy at the same time.
7. Financial Vision Board
Good habits contribute to a healthy lifestyle. Similarly, good financial habits contribute to a financially stable future. You should start adapting good money habits to keep you away from any financial tension.
Inculcating healthy money habits also keeps you aligned with your financial goals and helps you fulfil your goals quickly.
8. Create specific financial Goal
Define your financial goals not just by words but by dates and numbers. It is crucial to describe numerically what you want from your money.
For example, set quantifiable goals, such as how much do you want to save? What will be the timeline for your savings?
9. Adopt a Spending Mantra
Apply a thumb rule to your spending. Keep asking questions from yourself that will help you to understand your money and your thought process better. For example, ask yourself if spending money on a new car is beneficial than going to the Maldives next year?
What will be a better trade-off than spending money on a luxurious spa? Answering these questions will help you to save more money and spend strategically.
10. Love Yourself
To stay happy, it is essential to love yourself. Taking control of your finances is one of the aspects of loving yourself. Financial planning and spending is one good way to make you calm and happy.
11. Set short term goals
According to research, long-term goals have fewer chances to be achieved than short-term goals. Hence, in the case of your financial goals, always try and set short-term achievable and realistic goals.
Long term goals may remain unfulfilled due to the longer timeline involved. Set short term goals that will reap quicker results and will give you mental satisfaction too.
12. Avoid negativity
Having a positive outlook towards life is very important for a peaceful life. Engaging yourself in a pool of negativity even before starting your financial planning will land you nowhere.
By staying positive and having good thoughts, you are keeping yourself motivated in whatever you do. Every positive thought has an impact on your action. The same goes for your financial decisions. Hence, begin with positivity and stay motivated.
13. Learn to appreciate
It is essential to appreciate what you have. One key tip is to stay happy with what you have. Instead of being greedy and trying to acquire more things out of your capacity, stay content.
This way, you can relish what you have and can enjoy your life without feeling demotivated.
14. Start with smaller debts.
If you are stuck in a financial quagmire, start with your smaller debts to eventually pay off your bigger debts.
Having a mountain of debts on you may make you feel stressed for a while, but act wisely and form a strategy to pay off your debts as soon as possible.
Many people borrow loans in their financial situation. Also, there are guaranteed loans for the unemployed available in the market. It may become difficult for people to pay off their loans instantly. Hence, it is essential to strategize your debt and loan payments.