As we continue to experience difficult economic times, it is important to do our part to improve our personal financial circumstances. Here are 10 suggestions to help you clean up your finances.
- Know your numbers. When it comes to money, knowledge really is power. Stay informed regarding your income and expenses, credit score, interest rates you pay and earn, debt amounts and anticipated pay-off dates, etc.
- Keep it separate. If you have business expenses, keep them separate from your personal finances. Finances are one area in which you really should avoid mixing business and pleasure!
- Know your type. Know your financial tendencies. Knowing if you’re a spender, saver, or avoider helps you steer clear of potentially problematic behaviors and find ways to accommodate your personal spending preferences while also keeping things within a reasonable budget.
- Don’t spend what you don’t have. This is sound advice that many ignore – and regret! Remember that the instant gratification associated with purchases on credit also means long-term and high-interest rates oftentimes. Before making purchases, be sure to ask yourself, “Do I need this right now or can it wait until I can actually afford it?”
- Save – No matter what. Even if you save only a few dollars at a time, it is important to be in the regular practice of saving. It’s a habit that we can’t afford to do without in these times!
- Stay organized. Clutter and disorganization in our physical space leads to clutter and disorganization in our mental lives. This can create tension which leads to and exacerbates financial avoidance, especially if financial concerns already exist.
- Create a monthly spending plan. Even if it takes time to develop and practice, creating a plan keeps you prepared to deal with financial concerns and decisions. A monthly spending plan keeps you aware of how you spend your money and if there are discrepancies between income and expenses.
- Bank/Pay bills online. With continuous improvements to security and privacy, online bill pay allows you to have 24/7 access to your income and expenses so you can stay informed about your finances. You can receive text and email notifications when bills are due or your account balance is low as well as check your finances on the go with smartphones and technological advances.
- Be card-conscious. Pay off purchases made on credit cards every month if possible. Know the annual fees and interest rates associated with various cards as well as the rewards earned with purchases. Be sure that rewards outweigh any additional fees and that you’ll be able to pay the balance in a timely manner to avoid additional rates and fees.
- Find a money tracking system – and stick to it! Consistent action and attention are more important than the particular system you choose to track your finances. Just remember to track it and be consistent!
