10 Smart Money Tips to Make You ‘Smart Money’
Some of us could learn more about money, most of us could learn a lot. Here are ten smart money tips that we should all adopt.
For many of us, how to deal with money isn’t something we’re taught. Even if our parents make a valiant effort, they likely didn’t cover everything. They might not have known everything. There are no high school courses on shopping for credit cards, improving your credit score, or breaking down the tax system. That’s why these ten smart money tips will help.
Money needs to be managed. Doing so correctly helps you keep more of your hard-earned money, and even puts it to work for you. Here are the top 10 personal finance tips that won’t just improve your financial literacy, but will permanently change how you look at money.
Find interest-earning accounts
You may have heard that the interest earned in savings accounts is so minor that they’re not worth it—that’s not necessarily true. There are other places where you can keep your money and earn better interest, but with higher interest often comes with more caveats.
Traditional options like money market accounts, bonds and CDs require you to keep that money off-limits for a certain number of months, but these days, the interest earned in so-called higher-earning accounts isn’t much more than some savings accounts.
Ask yourself if you may need access to those funds soon, then compare your options.
Use a cash-based system
Paper money feels and looks more authentic and valuable than a card you swipe. If you want to stick to a budget, of all the tips about money the best is to allow yourself a set amount of cash for disposable spending on a weekly basis. Then, when it’s gone, it’s gone.
Actually, create a fluid budget
Create a spreadsheet detailing all your take-home pay, established bills, and earmark funds for savings, emergency funds, and disposable spending. Re-visit the budget regularly, and adjust as necessary. Prioritize bills to pay off, and research ways to lower standing bills (i.e. negotiating for a lower phone bill or cutting some entertainment bills). Take your budgeting digital with apps like Mvelopes.
Aim to break even at tax time
Whether you look forward to a big return in the spring or end up owing Uncle Sam, recondition how you think about tax time. The goal is not owing or getting a return. Returns mean you gave the government a free loan.
Slim down your credit lifestyle
Having a credit history is important. Unless you’re 100% cash rich, you’ll need credit (and a credit history) to finance large purchases like a home. However, you don’t need to carry a credit balance. If you need help paying down existing debt, this tool is fantastic.
Adopt an “if I can’t pay cash now, I don’t need it” philosophy, and have small, monthly recurring payments attached to credit cards to keep them active.
Fix, re-use, barter and try out a second-hand lifestyle
Many Americans have lost the skill and mindset to fix what’s broken, choosing to replace it instead (and often with brand new products). Frugality means fixing what you can, re-using when it’s feasible, bartering instead of buying, and choosing second-hand options that are often higher quality and much more affordable.
Stop throwing money away
There are countless ways we waste money, from not using change to dumping goods at donation bins instead of selling them. Keep your change and use self-checkout machines to deposit handfuls of change without guilt. Sell items you no longer need or want at local consignment shops or online auctions. Know where to find the best prices on purchases and whether the trouble/distance to get there is worth it. Use frequent shopper programs, discount days, and other avenues for saving.
Get a financial consultant
Independent financial consultants usually don’t charge for their time. They make a commission when you purchase a “product” such as life insurance. Shop around, check online reviews, and ask for recommendations.
If you prefer having someone explain complicated financial topics than researching online, this is an excellent avenue—if you find a professional who’s passionate about helping their clients. If you need help finding a financial consultant that suits you, contact our friends at GuideVine.
Take joy in saving
It’s not as instantly gratifying, but most of us understand that saving instead of spending is better for us and our financial health. Finding ways to treat yourself that don’t require money or spending is critical. These gifts might include a walk outdoors, at-home pampering or an afternoon nap.
Learn smart money tips and ditch ignorance-is-bliss
Avoiding our credit scores, looking at our account balances, and signing for another student loan when we’re already struggling are short-term “fixes” that never work. Out of sight, out of mind doesn’t work with money. The longer you ignore it, the worse and more expensive it gets. Money requires daily attention to get on a healthier path. Apps like this can help you manage your money from day-to-day straight from your phone.
Even though personal finance isn’t something many of us are taught (even for those with MBAs!), it’s not too late to learn. You know your preferred way of learning, whether with a blog, apps, through professionals or podcasts (don’t forget the Debt Free Guys™’ Queer Money™ podcast). Start by dedicating a few minutes every day to better your money knowledge.
Money doesn’t have to be difficult, and it doesn’t have to be scary, but it does need to be top of mind. These ten smart money tips will help you make your money a priority, and that will help you achieve financial success.
This is a guest post from our friend Trevor McDonald. Originally from Pittsburgh, Trevor now lives in sunny San Diego and works as a freelance writer. In his free time, you can find him enjoying about any type of fitness activity imaginable.
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