Ah, managing finances, the least fun and the most confusing thing about being an adult. Managing your personal finances can pose issues for individuals of any age or income level.
It matters not how much money you have that determines whether your finances will be in order or not, it’s how you manage it. The highest paid CEO can still end up bankrupt if they don’t play their cards right. Read on to discover five essential tips to managing your personal finances and for more info, visits Stoneroselaw.com:
One financial mistake can throw your entire budget out and leave you staring into a black hole of debt, especially if you find yourself using credit cards to make necessary payments.
Ditch the plastic in favor of alternative sources of capital such as fast loans with low interest, just don’t leave it too late. It’s better to have a manageable loan today than a debt collector at your door tomorrow.
Have a Separate Savings Account
It may seem strange to have two different bank accounts, but when you look at the benefits, it’s a no-brainer. Keeping your savings in your everyday account can lead to overspending. Our brains are hardwired to spend money. Every purchase initiated the release of endorphins; happy chemicals that induce an addictive, pleasurable response.
This is why easy access to money that you’re not supposed to spend is a big no-no for most. Having a separate savings account removes some of the temptation and makes it that little bit harder to access your funds, helping you to exercise restraint.
Quality vs Cost
There’s a time to spend more on quality and a time to save by purchasing discount goods. The secret is to know when to employ which strategy. As a rule, spending more on durable products such as appliances, cookware, furniture, electronics and the like pays dividends in the long run. While the sticker price might be higher, they will last longer and provide higher value over the long-term. Conversely, look to save money in the short run with perishable or disposable goods where you might be able to get away with a cheaper brand.
Avoid Impulse Buys
The rise of online shopping has made it easier than ever to waste money. Not only is it much easier to browse items on your smartphone than it is in store, but items purchased online often come with a lower price tag, so it is easier to ‘justify’ your purchase. The ‘cart’ and ‘basket’ options exist for a reason, unless you need the item urgently, put it in your cart and come back in 24 hours. If you still want it, buy it. If not, remove it from your cart and be glad you didn’t waste money.
So many unnecessary expenses can be avoided by planning ahead. Make shopping lists and stick to them, organise stops on your trips so you can take the shortest route, and hear your bank account thank you every time you bring your lunch to work rather than buying it.
Not only will smart management of your finances today significantly improve your future stability, but it will also help you get the most out of life in the present. No one likes having to say no to plans with friends because they can’t afford it, or watching the needle on the fuel gauge shift to E when there’s no money until payday. Stick to your budget, live within your means and follow these tips to make money problems a thing of the past. You’ll thank yourself later.