10 Things Everyone Should Do For Financial Success
A lot of times, the world of personal finance many seem complicated and confusing but below are 10 simple things that you can put into effect for your personal finances in 2016 to make things less complicated and make planning your finances so much easier. Also be sure to check out more advice and personal finance tips at Clever Girl Finance!
#1 PAY YOURSELF FIRST
Contribute to your retirement accounts (401k, 403b, IRA, ROTH etc.) first by automating this process as soon as you get paid.
#2 UNDERSTAND YOUR CREDIT SCORE
Know what your credit score is and keep track of it. Don’t open unnecessary lines of credit or rack up debt you don’t need.
#3 BUILD CREDIT RESPONSIBLY
To build your credit, opt for a cell phone bill you pay monthly instead of a credit card you will be tempted to max out. If you do use credit cards, ensure you pay them off in full every month.
#4 REMEMBER YOUR CREDIT CARD IS NOT A DEBIT CARD
Money from a credit card is not free money. You will have to pay it back and with interest if you carry a balance for more than a month.
#5 SAVE AT LEAST 10% PERCENT OF EVERYTHING YOU EARN OUTSIDE OF YOUR RETIREMENT ACCOUNT
Open up a savings account that you don’t touch and is not easily accessible and save, save, save. This way if any unplanned financial obligations come up you don’t have to rely on credit. You can also split yours savings into categories like emergency fund, travel, shopping, new house etc.
#6 UNDERSTAND COST PER WEAR
This is the cost of an item divided by the number of times you’ve worn the item. For example, something you wear everyday has a low cost per wear while something you wear once a month has a high cost per wear. Factor this process into your shopping and you’ll get more bang for your buck.
#7 TRACK YOUR SPENDING, MANAGE YOUR EXPENSES
Having a budget is really important for your financial success. It will help you understand where your money goes each month.
#8 ONLY BUY WHAT YOU CAN AFFORD
You can do this by staying within the budget you’ve created. This means you are spending less than you earn which in turn means you’ll have money to save. If you want something but can’t afford it, find an alternative or save for it over time.
#9 LEARN ABOUT INVESTING; DON'T INVEST IN ANYTHING YOU DON'T UNDERSTAND
Long term investing seems like a deep dark hole but it’s the way to build wealth. There are so many terms thrown around it’s hard to keep up but you can start by learning the basics of what investing is and what investment avenues exist. Pick one, do your research, talk to an expert and then decide if you are ready to invest.
#10 EDUCATE YOURSELF
Read financial books, blogs and watch some well reviewed money shows. There are ton of great resources out there than can help you get better with and keep you motivated about your personal finances.