3 Essential Tips for your Personal Finances
April 7, 2011 | personal finance
Many of us live paycheck to paycheck while others can’t even pay all of their bills on time and are getting further and further behind as each month passes simply because they do not make enough money each week. It’s inevitable that things are thrown at us in life that we aren’t prepared for, that are unexpected and that we never saw coming. We can’t handle these unexpected emergencies if we are living this way. It’s important to prepare yourself for these obstacles and get your personal finances on track. Check out Financial Resources 101 for more information.
Here are three personal finance tips that will help you do just that:
Create a Budget Table
For this, you can use an Excel spreadsheet or Word document online or you can simply get out a pen and paper tablet and use it. You’ll want to make a couple different columns with the money that you have coming in and the money you have going out. Make a list of the amount as well as what it is that you are spending. Pick through and figure out what you need and what you don’t need so that you can try to eliminate or cut down on some of your bills so you don’t have as much money going out. For example, if you have all the movie stations on your cable, but don’t want to give up TV completely, simply lower your plan to one that is cheaper but has most of the stations – in other words, get rid of Cinemax, Showtime and HBO…those stations that you don’t really need. Same goes with long distance on the phone bill – if you don’t use it, get rid of it!
Eliminate All Debt
You can’t do this overnight because after all, it wasn’t created overnight. However, you can gradually get rid of it. You can add this to the above chart as a different column or you can add it to you your going out column (or it may already be there). After eliminating those luxuries that you don’t need (movie stations, trips to the hair and nail salon, trips to baseball games, long distance on the phone bill, etc.), you can better determine how much money you can have to go towards paying off your debt. Try to always pay more than the minimum payment that is required monthly so that you are actually paying off your principal balance. It doesn’t have to be much, even $10-$20 can do a lot for your balance plus you’ll get it paid off a little quicker. In addition, you’ll want to try to avoid using any credit cards while trying to pay them off. After you’ve eliminated all your debt, treat yourself to something real big for accomplishing such a big goal.
Set Up an Emergency Fund
Life takes it’s little turns and these turns aren’t always good ones or the ones we are expecting. Be prepared by setting back a little bit of money from each paycheck into a savings account. Keep building this amount up and try not to use it. The money will be there in case of an emergency. Maybe you need a new tire or motor or maybe your child gets sick and you need to get him or her to the doctor. Regardless of the reason, you’ll have money set back somewhere so that the situation can be handled properly and taken care of without the stress!
Your personal finances are what keep you and your family going so it’s important to have things in full order and be ready to face hard obstacles that come your way. A brighter future is ahead if you take control of your finances today.
Stacy L. is a guest writer for Brookside Patio Furniture which specializes in resin wicker patio furniture that one can store in this recommended Toledo storage facility.