Learning how to control and manage your finances can help you learn how to save money, even when it seems impossible. Many Americans now live from one paycheck to the next. An unexpected car repair bill can wipe out your budget for the month and leave you worrying about how you’ll pay your rent and mortgage along with all of the other things that you need. Whether you live on your own or have a family to support, you can pick up some easy and straightforward finance tips and get a handle on your situation.
Follow the 50/20/30 Rule
Elizabeth Warren wrote about the 50/20/30 rule in one of her books, which led to many people using it. This rule states that you should take 50% of the money you make and put it back for the things you need. Your needs should include rent/mortgage and your utilities. Use 30% of your money on things that you want like going out to dinner at a restaurant or buying tickets to a concert. The rest of your money goes into your savings account. This rule also says that you divide your money based on what you bring home with each check and not on the total amount you make.
Think About Each Purchase
Do you have a bad habit of spending more money than you wanted to when you shop? Even going to the grocery store can cause your spending to go out of control when you pick up things you don’t need. Many grocery stores stock small appliances and magazines along with other impulse items that shoppers buy without thinking twice. Before you buy anything, stop and think about it. Make sure you consider how that purchase will affect your budget and if you can afford it. For larger purchases, give yourself a minimum of 24 hours to decide if you should buy them.
Do Your Research
Investments change from day to day. While a stock might cost a lot today, there’s no guarantee the price won’t drop by tomorrow. Before you put resources into the stock market, investigate as needed. You need to look at how often the price of a specific stock goes up and down. The sooner that you start, the sooner you can start making money. Working with an Options trading broker gives you an expert who will be by your side and help you make good decisions about buying and selling.
When you use a debit card or credit card, it’s easy to spend money because you don’t see the bills or change. You may even find yourself shocked at the checkout counter when you see how much you spent but feel as though you can’t put anything back. Carrying cash can help you avoid these situations. When you need to hand over the money, you see how much you have left, which can help you decide if the purchase is worth it. It’s also helpful to give yourself a budget for the whole week and carry that cash with you.
Use Automatic Savings
Many banks now offer automatic savings accounts. You no longer need to manually add money to that account when you get paid. Each time that you get a deposit, the bank will move a certain amount of money into the account. You can start simple with just 5% of your check and slowly work your way up to adding more to the account. As the money leaves as soon as it arrives, you know that you cannot spend it. That money gives you a cushion that you can use for unexpected expenses later.
Finance Tips Anyone Can Follow
No matter how much experience you have, you can use any of these finance tips and find even more for your situation. You might send a portion of each paycheck to your retirement account to save for the future or look for a new health insurance plan that helps you save money today. Putting away your credit cards and sending more than the minimum balance helps you pay off your debt and improve your credit score, which can help when you buy a house. Easy and straightforward finance tips such as these will go a long way towards helping you get a handle on your financial situation.