For a lot of people money is directly correlated with happiness. For most, it’s not a matter of being extremely wealthy, instead they want to live comfortable without the worry of not being able to pay their bills.
Since we are starting a new year let’s kick it off right with taking a look at a few money management tips that will lead to a much happier you.
Always Track Your Budget
It is extremely important to always understand where your money is going each month. Start tracking your expenditures and then create a budget based on your current spending habits. If you find yourself spending too much on one particular category then trim back in that area. By creating a budget you will be able to hold yourself accountable for any spending that you might have.
Always Review Your Banking Products
Financial institutions and their products are always changing. It’s important to be proactive when it comes to the products and services that you use. You never know when there might be a better deal that could save you money. A few things to look out for might include:
- Insurance policies – Occasionally it’s important to check and see if you might be able to find identical coverage with a different company at a lower cost. Alternatively you can also look at reducing existing coverage that you might no longer need.
- Monitor your credit cards – Always stay up-to-date on the terms and conditions of your credit cards. If you pay an annual fee then make sure you are getting your value for the money spent. Ask yourself if there is a card that might offer a larger benefit at a lower cost.
- Consider a refinance – If you own a home then you might want to look into a refinance of your mortgage. With interest rates still at amazing levels you could easily save hundreds of dollars just by going with a lower interest rate mortgage.
Use credit cards wisely
Credit cards are great tools for consumers. We all need to purchase things in order to live so why not get rewarded for those purchases. Cash back cards offer you a certain amount back on your purchase and travel reward credit cards offer you points and miles for your favorite hotels and airlines.
When using credit cards it is important to use them wisely. Always make sure you pay your statement off at the end of each month. Finance charges can easily take away any value you might have received.
Set up an emergency fund
Having an emergency fund set up is extremely important. You never know when something might break and having the cash available will ease the burden. Most will tell you that putting aside as little as $1,000 is sufficient while others say you should have three to six months worth of expenses.
Make Saving Automatic
Way too often we set up goals to do certain things and then life gets in the way. Saving is one of those things that often takes a back seat. This year, do yourself a favor and set up your savings to be automated. It could be into an emergency fund, your retirement or even for your child’s college expenses. Set it up so that the money is automatically taken out of your account on payday. That way you won’t notice the money is gone.
Wrapping it up
Managing money can be a complicated thing for a lot of people. The nice thing is that it doesn’t need to be overly difficult. By using one or more of these money management tips you will become a more financially stable person.
*Editorial Note: Any opinions, analysis, reviews, or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any card issuer.