Why does it always seem like everything happens all at the same time. Since October 2017 my life has been non-stop go go go! I started a new side venture; my son was born; we bought a new house; Christmas celebrations; my daughters second birthday; New Years and now house renovations! It’s been extremely hectic these past few months but I wouldn’t have it any other way. Every event has been amazing and unforgettable. I am also one of those weirdos that believes that when I am busy my best self shines through.
This year I have decided that a majority of my posts will focus on your best self. I wholeheartedly believe that you are at your best when your life is organized. I know that for me that is 100% true. If my home is neat and tidy my productivity inside and outside of the home improves drastically. I also know that when I am excited about a new venture my first thoughts are how I will organize myself to include that venture into my daily, weekly and monthly routine.
This is what brings me to today’s post, 21 Extremely Easy Ways To Improve Your Finances. Having a healthy relationship with your finances revolves around two basic tenements 1. Organization and 2. Routine. In the bullet list below I will outline 21 Extremely Easy Ways To Improve Your Finances by being organized and by establishing simple routines. Ready or not your world is about to be rocked with just how easy it can all be!!!
Fooled you, not just yet! First I have a disclaimer to make, I am not a financial professional nor do I claim to be by any means. What gives me credibility in this arena is that I have been living 100% debt free for the past couple of years. I was able to pay off a 6 figure student loan debt in 6 years and I currently save more than 40% of my income all while living a very full life. So now without further ado here is my list!
- Know What You Owe!!! It doesn’t get easier than this, know exactly what you owe and to who. In an excel spreadsheet which I suggest you create to track your finances, designate one tab for Accounts. In that tab list all of your Major Credit Cards (Chase, Capital One), Store Cards (Macy’s, Home Depot), Student Loans, Auto Loans, Mortgage Account and their balances. Keep track of the balances on a routine basis. If your credit limit on each major credit card is under 10K, contact the card company and see if your limit can be increased. The increase in available credit will help to improve your overall credit score.
- Focus On Immediate Debt. In order to pay down debt you will need to outline exactly how much you owe and to how many different sources. It has been said that you should always pay down the card with the highest interest rate, while I totally agree that this is the best solution I would suggest that you pay down all of your cards at the same time to avoid any penalties for non-payment. In addition I would suggest that you aim to pay the amount spent each month by the end of the month. If you can’t afford to pay your card back at the end of the month, you can’t afford whatever it is that you are buying.
- Know Your Worth! Know your after tax earnings by paycheck. Track how much you receive per paycheck, monthly and annually. Then create a list of all of your fixed costs, items that have a set amount due each month like a car payment. Next create a list of all of your variable costs, items that change from month to month such as your grocery bill. Lastly add your fixed and variable costs minus what you bring home each month, this will show you if you are in the red! Do you spend more than you make? Are you breaking even? Or do you have a excess each month which you can use to pay off additional debt?
- Divide And Conquer!!! This is the ultimate key to my financial success. I split all of my spending into separate accounts. A bill pay account that is used to pay all of my bills; mortgage, day care, phone, internet, car, student loan, etc. A vacation account that my husband and I contribute to a monthly basis and use for trips and special occasion restaurant splurges. A pet account used for vet bills, food and toys. A gift account used for birthday and holiday gifts. A child savings account (college fund) and a personal savings account. What is left after all of these accounts receive their bi-weekly auto deposits is my fun money.
- While Your In Debt Don’t Give Yourself A Raise. This was key to me being able to pay off my student loan debt in 6 years. What do I mean by this, I mean that in your job over the years you will make more money or receive bonuses. While you have debt do not allow yourself the comfort of that added income instead take it all and put it towards the debt. Before that raise or bonus you were able to sustain your lifestyle so in essence that raise or bonus can easily be used towards debt.
- Think Old School. Remember the days when people balanced their checkbooks. Now we have online accounts where everything is tracked and calculated for us. I believe this has detached us from the action of accounting for our spending. Review your spending daily, weekly or monthly. Review each and every line item and see where you can make obvious improvements.
- Invest Wisely. Whether its cryptocurrency or the stock market, make sure that you are investing your money wisely. If you are in debt the best investment you can make is to pay off that debt. I can 100% tell you from experience that once you pay off all debt you feel like a million bucks, every single dime that I bring in goes straight into my savings or my fun money account. Being debt free is better than a raise, because you have all this new found money and no obligations to keep track of.
- Track Your Retirement And Pension. By keeping track of your retirement accounts on a continual basis you are more apt to increase your contribution. If you only revisit your retirement portfolio once a year you will be more prone to forget about it.
- Track Your Savings. Just like tracking retirement, tracking savings is a psychosomatic activity. If you see your savings account increasing week to week you will be more likely to contribute larger amounts and not touch it for hopes that it will keep increasing. We all like to see large numbers when it comes to our savings accounts.
- Use Cash Wisely. For a long time when I first paid off all of my credit cards I avoided credit like the plague. I opted to use cash for everything, I set a $200 budget for the week and when I ran out of cash I could no longer spend. This however became unrealistic quickly because not every week is the same. Some weeks I needed to spend more than 200 because of unforeseen expenses. Credit was much easier to use in those situations. What I did instead was give myself a fun budget which was cash, this was used for coffee, going to lunch with friends and the occasional splurge, for the rest of my weekly expenses I used a credit card. Credit cards also give rewards, something you don’t want to miss out on especially cash back rewards.
- Look Into Passive Income. If you have debt it means that you are not making enough money to cover your spending. This is obviously not a black and white issue because some debt is needed such as a mortgage or a student loan. This applies to consumer debt, like what you accumulate during the winter sale at Nordstrom. Passive income can be anything that gives you more money than what you are currently earning. It can come from a real estate investment, a multi level marketing company, a second job, posting on Etsy or selling on eBay.
- Sell, Sell, Sell. One mans trash is another mans treasure. If you are going to be listing items on eBay head over to my post on 21 Simple Tips For Selling Your Treasures On eBay, in this post I describe several strategies to creating the right eBay post to get your item sold quickly. Take the extra money you make monthly from your eBay sales and put it towards your debt, if you are lucky enough to not have debt take the earnings and add it to your savings or vacation accounts.
- If Spending Were As Hard As Earning. Don’t make spending too easy. It’s so easy to go on Amazon and spend hundreds at the drop of a hat. On-line shopping definitely accounts for the increased consumer debt problem in America. I have heard from multiple friends that when a package arrives at their door they don’t even remember ordering it! If you want something, think about it, then ask yourself can I get it locally at a store somewhere? Preferably a mom and pop shop? If yes, make yourself go and get it, you also save on shipping costs. The best part is because you have to go and get it, 9 times out of 10 that item doesn’t seem that appealing anymore and you end up not buying it at all.
- Is It A Want Or A Need? I used to watch Suze Orman’s show religiously, then I downloaded the podcast and listened to them all over again. She would always ask this question, is it a Want or a Need. If it is a need then you need to go get it. If it is a want then you need to be able to afford it!
- Buy Used. I’m not suggesting you buy everything used, I know for sure I don’t. I don’t love second hand clothes or shoes. However, when my friend offered me bags and bags filled with baby clothes that her daughter outgrew you better believe I took those clothes. I didn’t have to buy my daughter a single thing for a solid year! Buy used cars, appliances and furniture. These are all great items that have long lifespans. My hubby and I scored a brand new GE Profile double oven range for $500 because the couple selling it moved into a model home and immediately changed the appliances from white to stainless.
- Avoid Impulse Buys. You know the candy next to the cash register, they don’t put that there to annoy moms with kids; they put that there because it’s an impulse buy. “Well, I’ve been really good on my diet and this Kit Kat is buy 5 get 1 free so YOLO (You Only Live Once)!” or “I am thirsty I think I will get this soda which I normally do not drink for $1.79 even though I can buy a six pack for just a few dollars more.” Avoid things that you do not need. An occasional treat is one thing but creating a habit of buying items near the register can get costly. There is a reason that at clothing stores have small pieces of jewelry or scarfs by the register, they are small in size but not always in price, but you are suckered into buying it because it is merely there!
- Buyer Beware. I used to be the person that would buy 5 hair sprays because I got the 6th free. Or buy a pair of shoes for $200 because I got the 2nd pair for half price. Sometimes these are great deals however they just made me spend close to double what I wanted to spend because they gave me more of something that I probably won’t use. There have been tons of times that I did the BOGO (buy one get one) deal and either forgot to use the 2nd item or only used it one time. If you have a budget for say shoes buy what you need. If you need two pairs of shoes then you are in luck because that is a great deal!
- Save Everywhere You Can. A few months ago I wrote a post about my favorite way to save – Yelp. Check it out here: 5 Ways This App Can Save Your Family Money. Yelp has check in offers to your favorite restaurants, such as free appetizers, two for one entrees, free drinks, kids eat free or discount offers (be sure to check out the post to see all of the ways you can save). Just like Yelp, Living Social or Travel Zoo deals can save you hundreds on dining out and family activities. You can still enjoy the best places at a fraction of the cost. If Yelp doesn’t have a deal, check the restaurants website, sometimes they have coupons right on the home page. Be sure to also sign up for birthday rewards.
- Meal Plan. Ever since I started to really pay attention to my grocery bill I have been able to save roughly $20-$60 each supermarket visit. To find out how I was able to reduce my spending so much by meal planning visit a post I wrote a few months ago: Why Meal Planning Is The Best Budgeting Tool.
- Scale Back On Gifts. What bugs me more than anything is when a friend or a family member buys me a gift with money they don’t have. I would much rather not receive the gift than to know I am responsible for a portion of your debt. I’m sure your family feels the same exact way. Instead of spending money you don’t have on gifts, give your family or friends an edible treat, bake cookies and place them into a cute tin, or assemble hot cocoa mason jars (add cocoa powder, marshmallows, and peppermint bark). Also don’t be afraid to come clean and tell your friends or family that instead of exchanging gifts this year you would like to focus on paying down your debt. Believe me they will understand, and they will be grateful!!!
- Buyer Beware! Last but not least, review your receipts!!! Hey that rhymes! I can’t tell you how many times I leave the supermarket, go home, unload the groceries and then look at my receipt before I toss it and it’s wrong! Here is an example, I can’t make this stuff up!!!! At the super market I was charged for 12 avocados totaling $23 dollars, I only purchased 2 avocados. In fact the other day I was charged for a 63 cent kiwi that I didn’t even buy! Cashiers don’t do this intentionally (at least I hope they don’t) they are human and humans make mistakes. At restaurants, my husband and I have been charged for extra drinks, appetizers we didn’t order and even incorrect entrees. Always always always check your receipts no matter where you go. And don’t be afraid to speak up, this is your money, don’t pay for something that you didn’t buy! For fun keep track of the mistakes made and what it would have cost you for the year.
I truly hope that you found value in my list of 21 Extremely Easy Ways To Improve Your Finances. In order to stay on top of your finances you need to organize yourself and establish routines. After a while everything becomes second nature. Comment below if you have suggestions for improving your finances.