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12 Things You Can Do Now To Improve Your Financial Life

12 Things You Can Do Now To Improve Your Financial Life

A vow to improve your financial state is the sort of grandiose statement that usually accompanies New Year’s resolutions. Fortunately, however, actually achieving this goal could be among the most tangible objectives on this year’s list.

Improve your financial life today by taking action on one of the following:

Educate yourself.

Do you know what an IRA is? What is the sales tax rate in your state? How often do you expect bank statements; do you know what all of the terms on your statement mean? You can’t make sound financial decisions if you don’t know anything about finances, so take the time to pick up the phone and call your bank, grab a book from the library or spend some time online regularly furthering your financial education.

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Save.

Finish this sentence: “A penny _____ is a penny earned.” You guessed it: saved! A penny saved is a penny earned, that goes toward your grocery bill, to fund a trip, put gas in your car, or provide for a child. Pennies add up. Save them.

Diversify investments.

As you build up your savings, create a healthy mix of liquid (i.e., can get to within a day in case of emergency) and static (things it would take you longer to cash in on) investments. A good financial advisor can talk you through how to build stock accounts, mutual funds, or invest in land, a home, or your own business.

Pay down your debt.

Owe anything to anyone? Make ridding yourself of debt your top priority. If you’re not sure where to start, or how to steadily chip away at larger debts like student loans, seek expert help. Then dig deep to find the discipline to carry out your plan.

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Put yourself in Florida.

Or on a yacht, or in the mountains, or on a beach anywhere else you would like to retire. What are you doing to get yourself there? Debate abounds concerning the future availability of social security and other benefits, and it is wise not to depend on any income but your own for retirement. Consider inflation, rising medical costs, and projected family needs when you plan, but the short version is that if you want to retire before you’re 70, you must start saving today, and increasingly aggressively as you age. Learning about Roth IRAs is a good place to start the educational process, if the idea of saving for retirement is new to you.

Watch what you put in your mouth.

Do you know the price at each of your local stores for the groceries you most often purchase? No? Time for a field trip! Your household’s grocery bill is a large, recurrent expense that can easily be chipped away at with smart shopping. Remember to Google and print coupons before you go, read those sale circulars you get in the mail before you toss them away, and consider warehouse stores or online merchants for goods with a longer shelf life. Food thrown away is money dumped right from your wallet into the trash, so shop as often as you need to.

Step away from the television.

How much do you spend on satellite or other television subscriptions each year? How much time do you spend watching television? What else could you do with that amount of money? How else could you earn money, with that amount of “extra” time each week? Put down the remote. Step away.

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Unwire, just a little bit.

How many gadgets do you own that have internet access, stream video, and allow you to chat in some way or another with your friends? Do you really need that much redundant capability? Ditch one electronic device, or downgrade subscriptions that you truly do not use. You will survive, and your budget will thank you.

Get organized.

Dreading the spring, when taxes are due? Not certain how much money you actually spend, or where it is all going? Get a filing system in place, whether formal or in a shoebox, and start collecting and tracking receipts. Log your expenditures in an spreadsheet, or by hand on a piece of paper. Update your logs regularly, and you will be pleasantly surprised by how much more effective your financial planning process becomes, and how easy it is to file your taxes next year.

Unsubscribe from merchant emails.

How many times have you logged onto your email account and seen a picture of something you didn’t know existed, had never thought about, but now see is on sale and can’t get out of your mind? Save yourself (and your budget) the anguish, and unsubscribe from those lists.

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Do it on the side.

Work, that is. In our wired world, a side gig could be only a few internet searches away. Someone in your neighborhood may need a dog walked while they vacation, or a babysitter once a week. The trash at a local school may need to be taken out for a small fee. Nothing is too menial or small, if it adds income to your bottom line.

Date creatively.

Those $15 drinks and swanky dinners add up. While impressing a date is always nice, wow them with your financial savvy by mixing things up with home-cooked dinners, picnics, outdoor activities, or matinees. If that isn’t attractive to the one you wish to woo, they probably aren’t a good financial partner for you, anyway.

Thirsting for more? Check out these Best 15 Money Management Apps that Make Financial Planning Easy.

Featured photo credit: taxcredits.net via flickr.com

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Published on September 17, 2018

How Being Smart With Your Money Leads to Financial Success

How Being Smart With Your Money Leads to Financial Success

Achieving financial success is not something that just happens. Maybe if you win the lottery or something, but for the average person like you or me, it comes from a series of small steps you take over a long period of time.

With each step, you form a new smart money habit. And with each smart money habit, you build towards financial independence.

So what sort of habits can you form to get on that path? Let’s take a look at smart money habits you can start today to get you closer to a financially independent future.

1. Avoid being “penny wise but pound foolish”

It’s tempting to try saving a couple cents here and there when buying small items. However, that’s not where the real money is saved. You’re putting in extra effort for something that doesn’t move the needle.

You get the most bang when you’re able to cut down on your bigger bills. For example, finding a lower interest rate for your mortgage could save you $50+ per month. And cutting your transportation bill by purchasing a cheaper car or taking public transportation can provide large gains as well.

So, look at your recurring expenses such as housing, transportation, and insurance, and see where there’s wiggle room. It’s a much better use of your time than trying to pinch pennies here and there on smaller purchases.

2. When you want something big, wait

Impulsivity can get you in trouble in most aspects of life. Finances are no different.

It’s human nature to see something and want it right then and there. It starts as a kid in the checkout line at the grocery store, and it continues on through adulthood.

We get an idea in our head of something we want, and it’s hard not to go out and get it right then.

A good example is wanting a new car. Perhaps you’ve had your car for several years. It’s crossed the 100k mile mark. Maybe maintenance is due, and you’re annoyed that you need to replace the timing belt or purchase new tires.

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So, you get the itch.

You start digging around online, and you realize you could trade in your current car for something newer and more exciting… all for a few hundred bucks a month. Then you get obsessed.

Here’s where you have to take a step back.

Your newfound obsession is clouding your judgement. Rather than giving into the impulse, wait it out.

Set a timeframe for yourself. Maybe you come back to the decision three months down the road. See if the obsession lasts.

It might, but often, a funny thing happens. Often, you forget about it. And often, you find that the new car wasn’t a need at all.

The impulse faded. And you just saved yourself a ton of money.

3. Live smaller than you can afford

You finally get that big raise. And you want to celebrate – and why not?

You’ve been looking forward to this forever. And after all, it was all due to your hard work.

That’s fine, splurge a little. However, make it a one-time deal and be done.

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Don’t get caught in the trap that just because you’re now making more money, you should spend more.

Too often, people get more money and feel like they that gives them the means to buy a bigger house, a bigger car… you know the drill. Resist.

The fact is that living smaller than what you can afford is one of the fastest ways to build savings.

But if you constantly upgrade as you begin to make more, then you’ll never get ahead. You’ll just build up more debt along the way and have just as little wiggle room as before.

4. Practice smart grocery shopping

Food… it’s one of the biggest portions of any budget. And if you’re not careful, it can be one of the biggest drains on your wallet.

But luckily, there are a few things you can do to ensure that you stay smart with your money when buying groceries.

Create a grocery budget

Set a strict weekly grocery budget. When you know how much you can spend on groceries, you can then plan your weekly menu around it.

Once you know what all you need, you can go shopping and keep a running tally as you shop to ensure you’re on track.

I tend to do this in my head, rounding for each item. However, writing it down as you go would probably work best for most people.

Make a list… and never deviate

Never go to the grocery store without a list. If you go to the store with a ballpark idea in mind, you don’t have a true ide of what you need.

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You’re not well-researched. You don’t know what the sales are. As a result, you’re going to make decisions on the fly.

These impulse decisions will lead to overspending, which will derail your grocery budget.

Eat before going grocery shopping

It’s also important to eat prior to going to the grocery store. Hunger is a powerful force.

If you’re shopping on an empty stomach, everything is going to look good. In particular, you may find a lot of ready-made, processed snacks will look enticing.

After all, you’re hungry now and that food is easily available. So subconsciously, you may lean towards those items.

Unfortunately, not only are those items typically less healthy, but they’re likely more expensive. You pay for convenience.

However, when you eat prior to shopping, then you’ll shop with a clear mind. Your hunger won’t cloud your judgement, influencing you to make poor decisions like a cartoon devil resting on your shoulder whispering in your ear.

This makes it much easier to stick to your grocery plan.

5. Cancel your gym membership

Now that you’re all set on your food, it’s time to get smart about managing your budget in terms of physical fitness. And let’s begin by avoiding the gym. The gym bill, that is.

The average gym membership costs around $60 per month. That’s $720 a year.

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Yet, two out of three gym memberships go unused. That means two-thirds of people who have a gym membership are literally giving away almost a thousand bucks a year. It’s crazy!

I recommend seeking an alternative. One good alternative is to look into fitness streaming services.

Streaming services allow you to stream hundreds of workouts like Insanity and p90x, right in your own home for around $10-20 a month. That’s $40-50 less a month than the average gym membership.

Of course, then there’s the free option. The internet is full of free workouts that you can do on your own with minimal or no equipment.

For example, there’s the Couch to 5K program, that I personally used a decade ago to ease myself from couch potato to running my first 5K race. If I could do it, anyone could.

Then there are free resources like reddit that have limitless information on workouts. The Fitness subreddit has done all the research for you, populating workout tips and detailed workout routines for anyone to use in their wiki.

There are several routines that require no equipment. And you can join in on the subreddit to become part of the community, making it easier for those seeking comraderie and encouragement in their fitness goals. All for free.

It’s baby steps… And baby steps can start now!

I’ve never met anyone that can’t stand to be a bit smarter with their money. And on the flip side, anyone can get smarter with their money. But remember, it doesn’t happen all at once.

Begin by fighting your impulses. Prepare for the week and be smart at the store. And cut monthly expenses like gym memberships that are overpriced and you probably aren’t getting your money’s worth out of anyway.

The devil is in the details. And the details can change your lifestyle and prep you for a financially independent future.

Featured photo credit: Unsplash via unsplash.com

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