6 Ways To Be More Money Savvy in an Expensive World
Of the many skills we need to teach our children, money management is right at the top, but do you practice what you preach? Understanding how to be money savvy is not just about what comes in and goes out of your accounts, but it’s about the life you lead. So with this in mind, here are a few things that can make a big difference to being money savvy in your everyday life.
Plan for the Future
If you have set up a Roth IRA or a 401(k), give yourself a pat on the back. But for those that have not, there are many different types of ways to prepare for the future. For example, you can learn more about self-directed IRAs and other practices to ensure you keep financially afloat. We have to remember that it’s not just about living in the now, but about having good practices that see us through until old age.
Look at Your Bank Statements
If you do not keep track of your spending, this is one of the most important things to address. You could very well be wasting money on things you aren’t aware of. Sometimes, people are prone to unknown fees and are charged in error. For example, if you canceled your gym membership months ago, you could still be getting charged. Check your bank statement on a regular basis, and you could be saving a lot. It’s a very simple thing, but a wonderful habit.
Tracking Your Budget
Similarly, understanding how much goes out of your account is crucial, but tracking your budget means that you will see your biggest money mistakes. There are some fantastic apps out there that you can download onto your phone, such as Mint, which connects your bank accounts and tracks your spending. It categorizes where the money goes and gives you a reading based on your financial status.
Separate the Bank Accounts
You may have a bank account for you and one that you share with your partner, but have you ever thought about having more? Instead of keeping all your money in one place, you could split it into two, where you keep the money for essentials in one and one for spending bills in the other. When you start to leave only what you need in the spending account and avoid transferring money all the time, it’s going to help you build up your finances, as well as make you think twice about certain purchases!
Don’t Buy That Coffee!
One of the most simple things in the morning on the way into the office is to buy a coffee, but instead, make that first cup at home. That one cup of coffee that costs $3 is $12 per week, and $48 a month! Over the cost of a year, that’s $576 on one cup of coffee!
Wait a Day
One of the greatest things that we can do, especially if we think we need a certain item, is to wait for 24-hours before we make the purchase. We make purchases based on our emotions, and when logic kicks in, we may realize we don’t actually need it!
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