While everyone wishes they had a perfect financial situation, this is unfortunately rarely the case. In fact, numbers show that well under 50% of Americans have enough in savings to cover even a $1,000 emergency. However, saving money isn’t the only financial issue that people experience. Many spend too much on things they don’t need or simply don’t know where their money goes every month.
With that in mind, this blog post is going to look at a few underrated tips to improving your financial health and situation.
Avoid Lifestyle Creep
Getting a raise or finally paying off that auto loan is a great feeling. You will have more money coming into your pocket every month, but you need to be smart with it. When many people add extra discretionary income into their pockets, their standard of living also rises. This idea is known as lifestyle creep.
Lifestyle creep is when things once thought of as a special occasion or luxury, quickly become the standard. This could mean spending more eating out because you have more money, buying expensive clothes and a variety of other things. Lifestyle creep can often lead you to actually save less money than before, despite the extra money coming in.
Instead of allowing lifestyle creep to stifle your savings, try and live on what you were making before and put the extra into retirement savings, paying off bills or saving up for large necessary purchases.
Enlist the Help of a Professional
While some people can deal with and improve their financial situation on their own, others may require a little bit of help. Thankfully, your local area will likely have dozens of credit counselors or other financial advisors that will be happy to help you out. You should visit a few of them (while also looking at reputation and prices) before making a choice.
Visiting a wealth management family office and speaking with an advisor can be a good way to get your finances back on track. Whether you need help creating a budget, need to lower your spending or want to learn the best ways to attack debts, a financial advisor can often help.
Automate Your Savings
Sometimes, people are simply so busy that they cannot remember to save money each month. By the time they remember to send money to their savings account, it might already be spent or accounted for. The forgetful nature (or even laziness) of some people can often prevent them from getting ahead of the curve financially.
If you’re someone who struggles to save money each month, why not consider automating your savings? You can set up automatic transfers into your savings account on whatever schedule you want, and this will ensure that your savings account is always growing each and every month.
Be Patient With It
No one goes from struggling financially one day to being a financial maven the next. It is a process and one that you need to be patient with. You need to be ready for a journey that could potentially take a few months and you need to be willing to make sacrifices.
It can be a difficult and long process, but it is certainly worth it in the end. If you are struggling at any point, use your support systems such as friends, family members, and even your advisor. In addition to that, the internet is full of personal finance forums and blogs that can help as well.
Hopefully this article has been able to help you come up with some unique and creative ways to improve your finances. While these tips can help, it is ultimately your effort and drive to improve that will lead to you becoming more financially healthy.