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6 Important Tips for Getting Your Home Finances in Order

6 Important Tips for Getting Your Home Finances in Order

When it comes to financial issues, people tend to get a little edgy, and rightfully so. There is plenty of advice out there that is somewhat unrealistic or takes things to an extreme (things like cutting costs by only having one vacation a year or firing your driver don’t exactly apply to the average citizen). At the same time, focusing on comical penny-pinching at the expense of basic human dignity—e.g. not flushing when you go to the bathroom, like some people advise—won’t make much of a difference anyway. Such advice only leaves you frustrated because online advice columns seem to mistake average working and middle class people, who have a lower income and want to make the most out of their pay check—with down-on-their-luck hobos.

The truth is that there are some changes you can make that will make a big difference in terms of your home finances, without sacrificing much in the way of comfort. I won’t lie to you—it takes a decent amount of self-control, planning and some effort to get your finances in order, but with a good strategy you won’t be giving up much.

1. Find a big, useful goal or item that is worth saving money for.

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Setting a goal

    It’s difficult to get yourself on board with spending less and putting some money aside if you don’t have a good goal in mind. You need to look for an effective source of motivation, something that will be in the back of your mind every time you think about making impulsive purchases. This can be something like a great vacation on a tropical island, a new car, home renovation or moving into a bigger house. The thing is, you can combine different goals, even something that’s not directly related to money—e.g. if you spend less money on sweets and soda, you will lose weight and have more money. You should always have that big goal in mind and think about how the money you want to spend on insignificant things in the spur of the moment can actually bring you a step closer to what you really want.

    2. Make paying off your debt a priority, but choose a good strategy.

    You can’t really take control of your finances until you have managed to free yourself of debt. This might seem like a long and arduous journey, and it is, but it can be done in a reasonable amount of time. First of all don’t fall for those minimum payments as they are designed to keep you in debt for a long time. Second, you have good strategies like snowballing, where you start paying off smaller debts first while keeping the rest at minimum payments, and you even have online tools available to help you out. It is important to exercise a little bit of control when it comes to spending money during this strategy—you don’t have to say goodbye to luxuries; just don’t go above your means and buy only what you can afford with the money that’s left over from the bills and payments.

    In case you are facing a lot of debt that you don’t know how to handle, you may need to negotiate with the creditors or even try a debt-settlement program. Make sure you do some research and find reputable companies that offer a good and reasonably priced service, as there are plenty of frauds out there that are only after your money. So, there are plenty of options for everyone, even in worst-case scenarios.

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    3. Start doing DIY projects around the home instead of going to the store.

    You’d be surprised at how many things you can fix, improve and make yourself around the house and save a lot of money on repair bills, cleaning products, new furniture, decorations and much more. It is fairly cheap to caulk windows and make small repairs. This combined with adding thick curtains and draft protectors can help you save some money on heating bills and keep you warmer in the winter. An old piece of furniture can be made to look brand new with a bit of glue, sandpaper and a paint job—I’ve had friends ask about my cool new table, after I had worked over the table that was sitting in the living room for 10 years and had put some wood grain print decorative paper on the top. Most of these projects are cheap and require nothing much than some hard work and creativity, yet they can look incredibly good.

    4. Plan your shopping carefully and stock up on what you need once a week or once a month.

    Shopping for groceries

      No one says you can’t go to a restaurant from time to time—just make it a less expensive one for the time being—or order a pizza. However, stocking up on food has its advantages. You will always have something in the fridge and pantries when you’re hungry and you won’t have to make trips to the store in the middle of your quiet time, which means you’ll also save some money on gas. You can go online and find some cost-effective brands for any type of food you need, complete with nutritional facts for the health-conscious.

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      There are also sales and special offers at stores you can check out online, as well as coupons that can be printed out. Buying in bulk can also get you a discount, and making fewer shopping runs and buying in advance can also help you manage your budget a bit better. Plan a big weekly store run for most of your groceries, and a monthly or even bimonthly run for household chemicals, hygiene products and canned goods.

      5. Cook your own food, and cook it in bulk.

      Take a page out of the bodybuilder playbook and start preparing your own food. It’s much cheaper to get a bunch of ingredients and prepare a dozen tasty meals than it would be to eat twelve meals at a restaurant. You have plenty of great recipes and cooking tutorials online, so it’s not all that difficult to become a decent cook with a month or two of practice. Cooking plenty of food at once and then keeping it in plastic containers in the fridge allows you to prepare enough food for the next 3–4 days in one go. This is great for healthy lunch recipes that feature fish, chicken or ground beef, combined with a whole lot of vegetables. Frozen vegetables are just as nutritious as fresh ones, and can be cooked fairly quickly.

      Not only will you be saving time and making sure there’s always a tasty and healthy meal ready to go, but you will be saving money on your electricity bill as you won’t be cooking all that often—you can prepare enough food for several days in about 60–120 minutes. If you’ve stocked up on food, it also means that you can throw together a sandwich or make some mac and cheese quickly when you want a bit of a change.

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      6. Go green and start caring about the environment.

      Green earth

        Yep, being a green-minded hippie can actually pay off. Caring about the environment is all about recycling, not letting the water run all the time while you shave or apply your shower gel in the shower, turning off the lights and TV when you’re not using a room, not heating up the house to tropical temperatures in the winter, being careful about your car’s emissions and so on. You might also recognize these things as some of the most common energy-saving and frugal living tips. Just start being more or less eco-conscious and you will soon notice that you are saving a decent amount of money; plus you’re being fashionably green instead of cheap in everyone’s eyes.

        Putting the reins on your spending and taking control of your finances is not a project—it requires a few major long term lifestyle changes. You simply can’t get around that fact or make things easy. What you can do is find the right motivation, create a good strategy that ensures that you will be covering your basic costs of life, slowly paying off your debt and setting some money aside, all while not entire giving up the comfort that you are used to. It’s just a matter of getting used to a different way of thinking and making smarter choices.

        More by this author

        Ivan Dimitrijevic

        Ivan is the CEO and founder of a digital marketing company. He has years of experiences in team management, entrepreneurship and productivity.

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        Last Updated on March 4, 2019

        How to Use Credit Cards While Staying Out of Debt

        How to Use Credit Cards While Staying Out of Debt

        Many people will suggest that the best thing to do with your credit cards during these tough economic times is to cut them up with a pair of scissors. Indeed, if you are already in huge debt, you probably should stop using them and begin a payback strategy immediately. However, if you are not currently in trouble with your credit cards, there are wise ways to use them.

        I happen to really love my credit cards so I will share with you my approach to how I use mine without getting into deep financial trouble.

        Ever since about 1983 when I got my first Visa card, I continue to charge as many of my purchases as possible on credit. Everything from gas, groceries and monthly payments for services like my cable and home security monitoring are charged on credit. Despite my heavy usage, I have maintained the joy of never paying any interest fees at all on any of my credit cards.

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        Here are some tips on how best to use your credit cards without falling into the trap of paying those nasty double-digit interest fees.

        Do Not Treat Credit Cards as Your Funding Sources

        Too many people treat their credit cards as funding sources for major purchases. Do not do this if you want to stay out of trouble. I use my credit cards as convenient financial instruments so I do not have to carry around much cash. In fact, I hate carrying cash, especially coins. When you buy things on credit, the purchases are clean and you will not get annoying coins back as change.

        I do not rely on my Visa, MasterCard or American Express to fund any of my purchases, large or small. This brings me to my golden rule when it comes to whether I will pull out any of my credit cards either at a retail or online store.

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        I never purchase anything with my credit cards if I do not have the actual cash on hand in my bank account.

        If I really cannot pay for the item or service with cash that I already have at the bank, then I simply will not make the purchase. Remember, my credit cards are not used as funding sources. They are just convenient alternatives to actual cash in my pocket.

        Make Sure to Always Pay Off Balances in Full Each Month

        The next very important part of my overall strategy is to make absolutely sure that I pay the balances in full each and every month no matter how large they are. This should never be a problem if the cash has been budgeted for my purchases and secured in the bank. I have always paid my full balances each month ever since my very first credit card and this is why I never pay interest charges.

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        Using Credit Cards with Rewards

        Most of my credit cards are of the “no annual fees” type, including one MasterCard on a separate account I keep at home as a spare in case I lose my wallet or incur any fraudulent charges. However, I do use a main Visa card which does have an annual fee because all purchases on that card reward me with airline frequent flyer points. For me, the annual fee is worth it since I do travel and I get enough points to redeem many free flights.

        You have to decide for yourself if you will charge enough purchases on credit each year without paying interest charges to warrant a credit card that rewards you with airline points (or other rewards). In my case, the answer is “yes” but that might not be the case for you.

        I occasionally use a MasterCard or American Express card on small purchases just to keep those accounts active. Also, I have been to the odd retailer that accepted only a certain type of credit card, so I find that having one from each major company is quite handy. Aside from my main Visa card which earns the airline points, the rest of my cards are of the “no annual fees” variety.

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        So this is how I use my credit cards without getting into any financial trouble with them. This strategy is recommended only if you are not in debt, of course. In fact, it is worth keeping in mind once you’re out of debt so that you can keep your credit cards active and treat them responsibly.

        What are your credit card usage strategies? Let me know in the comments — I’d love to hear what methods you use.

        Featured photo credit: Artem Bali via unsplash.com

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