Whether you’re stuck in a cycle of debt, earn too little to maintain your desired standard of living, or simply want to get a jump start on saving for a major financial goal such as buying a home or investing, you may need help to get on track with your objectives. Follow these strategies for taking control of your finances right now.
Read Books About Personal Finance
If you need help with your finances but aren’t sure where to start, seek financial wisdom from books written by experts.
There are many books out there on taking control of your finances, from how to get out of debt to how to build an investment portfolio. Books offer a great way to change your approach to managing money.
To boost your savings, buy used financial books online or borrow them for free at your local library. Consider audiobooks if you would rather receive the advice by ear.
If you are struggling to handle your finances, then you likely need to create a budget—a plan for how to spend your money each month that is based on how much you typically earn and spend. A budget is your best tool to change your financial future.
To start, write down your income and all your expenses, and then subtract the expenses from the income to determine your discretionary spending. At the start of each month, set up a budget to allocate how discretionary funds get spent. Track the spending over the course of the month, and at the end of the month, determine whether you stuck to the budget.
If you spent more than you made, fix your budget by cutting unnecessary expenses or earning more. Implement the revised budget the next month to start living within your means.
Reduce Monthly Bills
One of the easiest things you can do to take control of your finances is to cut your monthly expenses.
While you may not be able to reduce certain fixed expenses, such as rent or a car payment, without drastically altering your lifestyle, you can reduce variable expenses, such as clothing or entertainment, by being flexible and thinking frugally.
You can, for example, reduce electricity consumption to lower your utility costs, choose different providers for your home or life insurance, or buy your food at a discount at bulk stores.
Speaking of cutting monthly bills, there’s likely one bill that you could cut right now and potentially save hundreds of dollars every month: your cable bill. If you need a little help with your finances or you just want to reach your financial goals more quickly, you should consider cutting cable.
You don’t even have to give up TV altogether. “Cutting the cord,” that is, eliminating costly cable services in favor of low-cost streaming services such as Netflix and Hulu, allows you to watch the shows you love without spending a ton each month.
If, after reviewing various streaming options, you’re still determined to stick with your cable provider, downgrade to a cable package with fewer channels to save a little money every month.
Stop Eating Out
Looking for an easy way to take control of your variable expenses every month? Curb your habit of eating out. The occasional splurge at a nice restaurant is fine, but the savings can add up if you start cooking at home or bringing bagged lunches to work instead of eating out each day.
Start small by cooking at home at least once a week. The next week, start taking your lunches to work. You may be surprised at just how much you can save. Over a 40-year period, brown-bagging it can save you $1,300 per year, or more than $50,000 over a 40-year career.1