It doesn’t seem like saving money should be so difficult, and yet, there are a huge number of people out there living from paycheck to paycheck and struggling to dig themselves out of debt, even as they fall deeper into it. To some degree this could be blamed on financial hardship, especially with the effects of the recent recession still impacting our economy and job market. But the truth is that some people are just better at saving money, living within their means, and managing their personal finances. And the unfortunate truth is that, to some degree, you have to learn to do this on your own. Despite the important role that finance plays in the life of modern adults, it is not a subject that is generally covered in school curricula. However, there is help out there for people who need it. And if you’re looking to start saving money and improving your personal finances, there are a number of easy ways to get on track.
The place to start is by putting together a budget, and if you’re not sure how, try downloading a template, taking an online tutorial, or speaking with a financial planner to get the information you need. In the most basic sense, a budget requires two columns – one for income and one for expenses. Your budget may or may not be more complex, but the idea is to become aware of your spending habits so that you can spot problems and begin to address them to get your finances in order. If, for example, you discover that you’re spending more than you actually earn every month, you can easily see why you never seem to be able to dig your way out of debt. A budget is a springboard for improving your financial situation.
What you’ll likely find is that credit cards are a major problem, particularly when you spend more than you can afford to pay in any given month. The next time you think about swiping your card for frivolous purchases, consider whether the item in question is worth the interest you’ll pay on it. Would you buy that pair of boots or opt for coffee at Starbucks if you knew it would cost you three times as much? Why pay $15 for coffee when you can make it at home? This is an extreme scenario, but it highlights an important aspect of credit card spending that most people never stop to consider.
Using a credit card is no different from taking out a loan – it isn’t cash-in-hand. So the next time you pull out your card to buy coffee, or anything for that matter, ask yourself it it’s worth taking out a loan to do it. This should help you to cut back on credit card spending. You could also cut up your cards if you simply don’t have the willpower to stop yourself from using plastic to pay, and you may have to take this extreme measure in order to improve personal finances.
Finally, you need to make a concerted effort to save. And if you think that you don’t have even a dime to spare, think again. An easy test is to put ten or twenty dollars from every paycheck into your savings account the moment you get paid. Then vow not to touch your savings. What you’ll find is that you really don’t miss that money. If you consider it untouchable, you’ll find ways to work without it. No one said it would be easy to improve your finances and save money. But with a solid plan in place, it is possible to disburse debt, save money, and create a bright financial future for yourself.