A low-risk high pay off attitude you need to adopt is practising good financial habits. The sooner you start following these financial tips, the better as it is never too late to change your financial habits.
And if you’re looking for good financial tips to start with, then you’ve come to the right place. Whether you’re looking to steer your spending habits in the right direction for a more secure future or looking to save enough money for a down payment on a large purchase like a car or house, here are a few tips that will help you get started.
Financial tips to live by
To help you manage your money better, here are a few tips for your personal finance that you can also apply to your family’s budget.
Avoid Impulse shopping
Picture this, you step into a store, find this cool looking, limited edition snow globe. You think about how cool it would look on your shelf, and how it can start conversations when you have guests over. It’s enticing, the blizzard that happens when you shake it is mesmerising. So, you quickly purchase it.
Congratulations, you have just made an impulse buy. Impulse buying is finding a cool item at a store, and buying it without much thought about the consequences. But don’t worry, just about everyone is guilty of this.
Now, an impulse buy every now and then is fine, but it becomes a problem when you do it every time you step into a store, it can cost you a few hundred dollars every month. Here are a few disadvantages:
- Clutter. Knick knacks can add clutter to your home, and buying more food than you and your family can consume will only go to waste. It’s safe to think that you literally just threw money away after storing it in your fridge for a few weeks.
- Wasteful spending. When you impulsively buy an item of clothing you will only use once or never at all, you are wasting money. Money that would have been happier staying in your savings account or your wallet.
- No money when needed. When the time comes to pay the bills, you’re going to wish that you didn’t buy that expensive phone.
Let’s go back to the store. You pick up a cool looking, limited edition snow globe. You think about how cool it would look on your shelf, and how it can start conversations when you have guests over. It’s enticing, the blizzard that happens when you shake it is mesmerising. But you put it down and step out of the store because the money you currently have is just enough for your groceries.
Create and stick to a budget
For some people, handling money can be overwhelming. In fact, some people don’t even try to allot money for their necessities and just wing it. Now, if you have an unlimited supply of money, or if you’re earning so much money that you don’t need to think about it, you will be living the dream.
But that’s just a dream. In reality, you earn just enough money to get by. This is where a budget can come in handy.
However you choose to do your budget, the goal should be the same: allocate the right amount of money for all your needs. That means allocating cash for bills, savings, everyday expenses, and allowance for your kids. There are plenty of ways to create a budget, you just need to find a way that works best for you. Here are a few ways you can manage your budget:
- A spreadsheet. A great way to do your budget is with a spreadsheet. You can either use Excel or Google Sheets, here you can list the amount you will get on payday, and underneath that, list everything you need to pay and how much it will cost. It’s a great way to keep track of everything, and it can give you a total amount you need to spend every month or week. You can also use the spreadsheet to keep track of who owes you money and how much. The only downside to this is that you will need to use a computer everytime you need to update.
- A mobile app. The term: “There’s an app for that” applies to just about every aspect of life these days, including budget management. There are several mobile apps designed to help you with your budget. Some of the more popular budget apps are Pocket Book, TrackMySpend, and RAIZ. It’s easy to access, and these apps are easy to use.
- Use your bank. Accessing your bank accounts has never been easier. If you have to make a fixed payment every month, you can use your bank’s app or website to make automatic deposits. This way, you don’t forget to make your payments. All you have to worry about is making sure there’s enough money on your account.
Once you create a budget, make sure to follow it and never stray from it unless it’s an emergency like car repairs, replacing household appliances like your washing machine. But then again, if you beefed up your savings enough, emergency expenses will not be a problem.
Responsible grocery shopping
Grocery shopping is a fun activity. It’s a chance for you to stock up on food, and other supplies. But when you’re working with a budget, you need to watch out for item prices so that you don’t go over budget, and don’t shop for too much. Here are a few ways to stick to your grocery budget.
- Create a shopping list. Before you leave for the store, go around your kitchen and list down everything you are low on. A list reminds you what you need to buy, and avoid the need to return to the store, using up petrol and your time. Double check everything before you leave, to make sure you have listed down everything you need.
- Meal plan. Aside from creating a shopping list, another way to save money is to create a meal plan. List what meals you want to prepare for the week, and list the ingredients you will need if you need to buy it. When you make a meal plan, make sure to avoid eating out when you can to avoid spending too much money. It’s also important to eat the leftovers when you can to make sure you get the most out of each meal.
- Compare products and prices. When you get to the store, make it a point to compare product prices. Compare the price based on weight, and product quality. That way, you can get the most out of your purchase.
Stock up your fridge just enough to make sure you and your family have enough until you need to go grocery shopping again. If you have kids that want treats at the grocery store, make them earn it by allowing them to do small chores around the house. It teaches them responsibility, and you will have a cleaner home. A win-win situation!
Avoid redundant spending
Redundant spending is essentially spending twice on a service. A good example is paying for a streaming service like Netflix and cable TV.
The only way to combat this is to take the time to list the services you are currently paying for, and cancel subscriptions that you think are doubled.
When you cancel subscriptions to certain services, especially those that you are hardly using, you will see that your income has been freed up, and you can now use the money for other things like paying off your bills, adding it to your weekly budget, or be able to afford more groceries for your home.
Maintain the items you already have
They say that you don’t appreciate something until it is gone. That is why you need to maintain the appliances and other things you have in your home to avoid the need to replace them prematurely. Here are a few ways:
- Tune up your car. Getting your vehicle checked regularly is important, after all, you will need it to get around town. Aside from tune-ups, it’s also important to keep it clean inside and out to prevent vermin from getting a whiff of it and making it their home.
- Clean your appliances after use. Your car isn’t the only one that needs to be taken care of. After heating leftovers and other food items, make it a point to clean your microwave. In fact, clean everything after every use. That includes your coffee maker, toaster, and other household items to extend their lives and keep them running smoothly.
- Fix minor breaks. If you notice a strange noise in your car while driving, don’t ignore it. Find out what is causing it and fix it as soon as you can. Getting the small breaks is essential to prevent the more significant problems from arising.
Prevention is better than cure, and if you take care of your appliances, they will take good care of you and save you more money in the long run.
Create a bank account and make regular deposits
As mentioned above, accessing your bank accounts have never been easier. So, make it a point to make regular deposits to your bank account. Building your savings can go a long way. Decide on how much you want to put into your savings, and commit to putting it away. You can automate your bank account to transfer funds to your savings, or you can do it manually.
Breaking the habit of spending more than you should is a challenge worth facing. Once you overcome it and practice healthier financial habits, everything else becomes a little bit easier. Try these tips for yourself and remember to do it every day.
A benefit of following these financial tips is being able to enjoy a good credit standing, making it a lot easier to get approved for things like car finance, allowing you to get a car for everyday use.
In fact, if you are suffering from bad credit, car finance can help you rebuild it. Consider getting a bad credit car finance if you need a car and have trouble getting approved for a regular car loan.