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6 Ways To Improve Your Financial Stability In 2015

6 Ways To Improve Your Financial Stability In 2015

Financial stability isn’t built in a day – it requires a lot of work and formation of correct habits. But before you can even start doing this work, you have to make some decisions and take action – and what time can be better for it than the beginning of a new year?

1. Eliminate Debts

If you have credit card, unpaid student loans and similar debt, you should try and get rid of them as fast as possible and avoid getting into further debt. Although sometimes getting credit may be beneficial (if you want to use it to make an investment), you should never ever, under any circumstances, get credit for consumption. If you can’t afford something pleasant right away, you shouldn’t buy it – it is as simple as that.

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    2. Create an Emergency Fund

    Think about how much you spend on average every month. Then make it your first priority to put aside enough money to support you for at least 3-6 months in case you lose your primary source of income tomorrow. When you find out how hard it is to make it work, you will probably understand how dependent you are on your employer, which will serve as an additional motivation to work on financial stability.

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      3. Think about Auto Insurance

      Is your car insured? If not, it is high time to get to it. You may say to yourself that you are a cautious driver, that you haven’t had a single accident throughout your life, or that you can’t afford it. But the truth is, you are not alone on the road. And while you can try to be the safest driver in the world, it doesn’t cancel the existence of all of the kinds of irresponsible drivers around – and all you have to do to get into trouble is to meet one. So study auto insurance quotes and make sure you’ve protected yourself against all eventualities.

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      Hand with money and toy car

        4. Buy into gold IRAs

        Gold is probably the only commodity that steadfastly withstood all the crises, recessions and perturbations the world sent our way – for the entire duration of the known history. If it is stability that you are after, then you have no better choice than gold IRAs – because in their case, you may be completely sure you are not going to lose your investments. Just make sure to steer clear of suspicious organizations, and you are going to be alright.

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          5. Save with your 401k

          Many young people today put off the planning of their retirements until the last possible moment – which is the wrong choice, no matter how old you are. Moreover, if you start putting money away in your 20s, you will be amazed how much you will be able to save by the time you retire. So start immediately, and your best bet is probably your 401(k). Try to increase it to the maximum of what your company is ready to match – even if you have to live frugally right now, it will pay itself off in time. Do your research, protect your future.

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            6. Think about Your Family

            However unpleasant the thought is, all of us are mortal, and sometimes that is evident in a more sudden and tragic way. If there are people who depend on you – your spouse, children, parents – you have to think about their financial stability in case something happens to you. Insure your life and health – write a will and don’t put it off.

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              You may think that in your life everything is alright and nothing can go wrong, that you have plenty of time to put off thinking about your financial stability. However, things happen – and you will do yourself a world of good if you start this year with making some hard and unpleasant, but totally beneficial, decisions.

              Featured photo credit: Money/401(K) 2012 via flickr.com

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              Melissa Burns

              Entrepreneur

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              Published on November 20, 2018

              The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

              The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

              The truth is, there are many “money saving guides” online, but most don’t cover the root issue for not saving.

              Once I’d discovered a few key factors that allowed me to save 10k in one year, I realized why most articles couldn’t help me. The problem is that even with the right strategies you can still fail to save money. You need to have the right systems in place and the right mindset.

              In this guide, I’ll cover the best ways to save money — practical yet powerful steps you can take to start saving more. It won’t be easy but with hard work, I’m confident you’ll be able to save more money–even if you’re an impulsive spender.

              Why Your Past Prevents You from Saving Money

              Are you constantly thinking about your financial mistakes?

              If so, these thoughts are holding you back from saving.

              I get it, you wish you could go back in time to avoid your financial downfalls. But dwelling over your past will only rob you from your future. Instead, reflect on your mistakes and ask yourself what lessons you can learn from them.

              It wasn’t easy for me to accept that I had accumulated thousands of dollars in credit card debt. Once I did, I started heading in the right direction. Embrace your past failures and use them as an opportunity to set new financial goals.

              For example, after accepting that you’re thousands of dollars in debt create a plan to be debt free in a year or two. This way when you’ll be at peace even when you get negative thoughts about your finances. Now you can focus more time on saving and less on your past financial mistakes.

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              How to Effortlessly Track Your Spending

              Stop manually tracking your spending.

              Leverage powerful analytic tools such as Personal Capital and these money management apps to do the work for you. This tool has worked for me and has kept me motivated to why I’m saving in the first place. Once you login to your Personal Capital dashboard, you’re able to view your net worth.

              When I’d first signed up with Personal Capital, I had a negative net worth, but this motivated me to save more. With this tool, you can also view your spending patterns, expenses, and how much money you’re saving.

              Use your net worth as your north star to saving more. Whenever you experience financial setbacks, view how far you’ve come along. Saving money is only half the battle, being consistent is the other half.

              The Truth on Why You Keep Failing

              Saving money isn’t sexy. If it was, wouldn’t everyone be doing it?

              Some people are natural savers, but most are impulsive spenders. Instead of denying that you’re an impulsive spender, embrace it.

              Don’t try to save 60 to 70% of your income if this means you’ll live a miserable life. Saving money isn’t a race but a marathon. You’re saving for retirement and for large purchases.

              If you’re currently having a hard time saving, start spending more money on nice things. This may sound counterintuitive but hear me out. Wouldn’t it be better to save $200 each month for 12 months instead of $500 for 3 months?

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              Most people run into trouble because they create budgets that set them up for failure. This system won’t work for those who are frugal, but chances are they don’t need help saving. This system is for those who can’t save money and need to be rewarded for their hard work.

              Only because you’re buying nice things doesn’t mean that you’ll save less. Here are some rules you should have in place:

              1. Save more than 50% of your available money (after expenses)
              2. Only buy nice things after saving
              3. Automate your savings with automatic bank transfers

              These are the same rules that helped me save thousands each year while buying the latest iPhone. Focus only on items that are important to you. Remember, you can afford anything but not everything.

              How to Foolproof Yourself out of Debt

              Personal finance is a game. On one end, you’re earning money; and on the to other, you’re saving. But what ends up counting in the end isn’t how much you earn but how much you save. Research shows that about 60% of Americans spend more than they save.[1]

              So how can you separate yourself from the 60%?

              By not accumulating more debt. This way you’ll have more money to save and avoid having more financial obligations. A great way to stop accumulating debt is using cash to pay for all your transactions.

              This will be challenging, depending on how reliant you are with your credit card, but it’s worth the effort. Not only will you stop accruing debt, but you’ll also be more conscious with what you buy.

              For example, you’ll think twice about purchasing a new $200 headphone despite having the cash to buy them. According to a poll conducted by The CreditCards.com, 5 out of 6 Americans are impulsive spenders.[2]

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              Telling yourself that you’ll have the discipline to not buy things won’t cut it. This is equal to having junk food in your fridge while trying to eat healthy–it’s only a matter of time before you slip. By using cash to make your purchases, you’ll spend less and save more.

              A Proven Formula to Skyrocket Your Savings

              Having proven systems in place to help you save more is important, but they’re not the best way to save money.

              You can search for dozens of ways to save money, but there’ll always be a limit. Instead of spending the majority of your effort saving, look for ways to increase your income. The truth is that once you have the right systems in place, saving is easy.

              What’s challenging is earning more money. There are many routes you can take to achieve this. For example, you can work long and hard at your current job to earn a raise. But there’s one problem–you’re depending on someone else to give you a raise.

              Your company will have to have the budget, and you’ll have to know how to toot your own horn to get this raise. This isn’t to say that earning a raise is impossible, but things are better when you’re in control right? That’s why building a side-hustle is the best way to increase your income.

              Think of your side-hustle as a part-time job doing something you enjoy. You can sell items on eBay for a profit, or design websites for small businesses. Building a side-hustle will be on the hardest things you’ll do, be too stubborn to quit.

              During the early stages, you won’t be making money and that’s okay. Since you already have a source of income, you won’t be dependent on your side-hustle to pay for your expenses. Depending on how much time you invest in your side-hustle, it can one day replace your current income.

              Whatever route you take, focus more on earning and save as much as possible. You have more control than you give yourself credit for.

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              Transform Yourself into a Saving Money Machine

              Saving money isn’t complicated but it’s one of the hardest things you’ll do.

              By learning from your mistakes and rewarding yourself after saving you’ll save more. What would you do with an extra $200 or $500 each month? To some, this is life-changing money that can improve the quality of their lives.

              The truth is saving money is an art. Save too much and you’ll quit, but save too little and you’ll pay for the consequences in the future. Saving money takes effort and having the right systems in place.

              Imagine if you’d started saving an extra $100 this next month? Or, saved $20K in one year? Although it’s hard to imagine, this can be your reality if you follow the principles covered in this guide.

              Take a moment to brainstorm which goals you’d be able to reach if you had extra money each month. Use these goals as motivation to help you stay on track on your journey to saving more. If I was able to save thousands of dollars with little guidance, imagine what you’ll be able to do.

              What are you waiting for? Go and start saving money, the sky is your limit.

              Featured photo credit: rawpixel via unsplash.com

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