Most Americans don’t have sufficient funds in retirement accounts. Naturally, they can’t just retire and continue working. Whereas there are people who take early retirement. Start managing money well today so that you won’t regret when you’re old.
After graduation from the university where occasional side jobs were my best friends, I’ve got a fright:
Yes, I’ve found a great job with a regular income; but now I started thinking about how to save and boost this fortune.
Time management never was my strong suit. What I did when in college was relying on parents and loans, and it seemed I wasn’t alone in the problem: surveys say that American students are those most stressed about finances, with rent, food, and social as three most cost-intensive fields for them.
Frankly speaking, I doubt if statistics are much different for students from other countries.
Either way, it took me several years after graduation to organize finances so they would work on me rather than the reverse. I’ve developed several useful habits that help to save money, and even created a step-by-step instruction on money management!
So why not share it with others for young people to feel safe and comfortable in case of financial crises?
Here it goes.
Your Six Steps to Smart Money Management
That’s what you need to do with money today to not regret tomorrow:
1) Stop living on credit
The first step to take for better money management:
Pay down all debts and withdraw all loans. Yes, your habit of borrowing $100 doesn’t look catastrophic at first sight – especially if you have a credit card with no charge for interest – but such practice reminds jog in place.
You’re out of money all the time, and every next month starts with paying debts.
For a start, do your best to break this vicious circle. Try to avoid impulse shopping. Be on a budget for a month or two: give yourself a task to forget about shopping until you break even.
Once you get extra money, use it for debt repayment. Develop a habit of rejecting all new credit offers from banks. It’s a psychological trap: a person believes he gets outside income but, in fact, remains owing to his bank.
Unfortunately, health problems may happen at the most inappropriate moments. Anyway, you can secure yourself against a part of expenses on it. How?
First, don’t cut corners on healthy fresh food and comfortable gyms! (It’s a deposit of your wellbeing.) You better save money on cigarettes, alcohol, and any other bad habits you have.
Second, think if you need medical insurance. Sure thing, you can do without it if having the flu once a year. But health coverage can save in case of grave diseases.
Also, don’t be lazy to visit a dentist twice a year. It will be much cheaper than medicating teeth in an advanced state of decay.
Start managing money today by investing for better health today!
3) Update your work equipment
This step refers to freelancers first. The faster and more efficient you work, the better the income you get. It means you can’t spend time waiting for a computer or outdated apps to start.
Tired eyes, back pain, and stresses from an inability to operate at your full potential are far from best helpers in earning money. Renovate or makeover your cubicle, add some productivity software in your computer.
Whether you write for a living, design websites, or develop software, take care of a comfortable workplace and necessary equipment.
4) Secure your house from unpleasant surprises
Insurance is a must, for any disaster has the potential to wipe out all your assets. To save money for the future, start thinking about your home ecology today. Don’t postpone minor repair once you find problems.
Dripping faucets, blistered-up walls, and broken furniture don’t seem a big problem unless they all ruin at once and claim big money for repairs.
So try to take action in good time. It will be cheaper and save your nerves and time. Also, think if you need home insurance in case of accidents.
5) Start saving your money
Once you’ve paid down all debts, taken care of health, and organized your house, it’s time to think of saving money.
The best way to do that is to lay savings aside once you’ve got wages, for example. If you want to put aside money at the end of a month, big chances are you’ll fail. Why? Because you may spend everything at that time!
So, decide on some fixed sum (five, ten, or twenty percent) of your monthly income and don’t spend it, no matter what. The task is to save a sum that would be enough for six months of the easy street in case you lose a job.
Even if it’s not a case, such war chest of reserves will give calm and confidence in the future.
6) Search the solutions for investment
An important way to manage our money is to keep it with several banks so you wouldn’t lose everything in case of a disaster. FDIC only insures $250,000 in a bank account.
Some people also prefer saving their cash in safe deposits to secure money in case of a financial crisis.
That’s all fine, but money management is not about savings only but smart investments as well.
Not to regret tomorrow, search the solutions for investing your money today. The unencumbered property, commodities, company stocks, real estate are great variants for your secure financial tomorrow.
Yes, it’s not that simple to understand all the nuances here; but hiring a financial specialist will help.
In a word
Start managing money today. Money management is not that difficult if you remember and follow several steps:
- Don’t rely on debts and credits.
- Care about your health.
- Invest in workplace and equipment for more efficient performance and, thus, better income.
- Don’t forget about home ecology, as it influences expenses on repairs and your health condition.
- Start saving your money.
- Think of reliable sources of investment.
Not to regret tomorrow, today is the best time to start managing your wages wise.