Feel like you live on a financial rollercoaster? Between a volatile stock market, disappearing job security and the rising cost of living, saving for the future and paying down credit card debt can be a serious challenge. The good news is that you don’t need an expensive financial planner to give your money a makeover. Thanks to online tools, at-home financial planning is easier than ever. Here’s how to finally break your bad money habits and get off the financial rollercoaster:
Prioritize your financial goals.Even with a limited budget, you can still achieve your financial goals – you just need to prioritize! Start by listing all your fixed expenditures, flexible expenditures and monthly income. Next, determine which financial goals are most important. Is it paying off that high-interest credit card debt? Affording your dream vacation? Maybe you double your monthly credit card debt payment or put an extra $50 in savings each month. It’s not possible to do everything at once, so prioritizing through smart financial planning is key. Focus your energy on achieving one goal at a time, and put your money towards this goal.
Know your number. In addition to your credit score, you should also know the amount you need to save each month for retirement. Use a free online calculator from Fidelity, Transamerica or Bankrate.com to determine your number. Once you’ve determined this number, treat it like a fixed monthly expense.
Automate savings. Build your savings account by automatically placing $50 or $100 in your account every month. When money is withdrawn automatically (just like your utility bill or mortgage), you won’t miss the cash – but you will love the savings!
Break up with your bank. Find yourself constantly paying fees? Choose a bank that fits your lifestyle – whether it’s fee-free checking or convenient ATMs. Many local credit unions offer fee-free services, and even refund ATM fees. Check FindABetterBank.com or Google Advisor to find the right bank for your needs.
Choose the right credit card. If you carry a lot of debt, stop worrying about reward points and switch to a card with a low interest rate while you focus on paying down your debt. If you’re debt free, pick a rewards card that matches your needs, whether you need airline miles or cash back. Not sure which card is right for your lifestyle? Visit a comparison site like www.indexcreditcards.com or www.creditcards.com for a quick comparison.
Cut out cable. Put an extra $50-$100 in your pocket every month by cutting out cable. Many popular shows are available for free online or for a small fee (such as Hulu Plus), or you can purchase a season pass on iTunes.
Shop smart. Use smartphone apps for comparison-shopping, like Price Check by Amazon, RedLaser and ShopSavvy. These apps let you check prices, find deals on eBay and Half.com, and even search local Groupon offers.
Buy less, enjoy more. Have you ever looked at your closet or garage and thought to yourself, “How did I accumulate all this stuff?” Shopping specials and “2 for 1” deals may seem like a good idea at the time, but unless you’re stocking up on toilet paper, it’s easy to end up with items that you simply don’t need, or won’t use enough to justify the purchase. When shopping in person, avoid impulse buys by only bringing enough cash for the items you need.
Save money on food. Plan your meals over the weekend and shop for ingredients as needed. Buy long-lasting ingredients in bulk using coupons and purchase perishable items (like produce or fresh seafood) as needed. Pre-planning cuts down food waste by utilizing the same perishable ingredients multiple times during the week.
Coordinate with your partner. Being honest about your finances can be painful, but it’s better to have the awkward conversations now, than waiting until a financial crisis to do so. Agree on common financial goals and visualize achieving them together. When we are connected with our future selves, it’s easier to delay immediate gratification in favor of long-term success.