Mastering your finances may seem like a daunting task, but like everything in life, money management can be learned. Although this process does require time and effort, the basic financial principles remain the same and are in fact, fairly simple. Here are six money advices to get you started.
Manage your finances together with your partner
Working through finances together with your partner and setting financial goals is a great way to secure a stable financial future for the two of you. The best way to start would be to lay bare all the information about your personal finances. This includes listing all your accounts and amounts of money available on them, your personal debts, as well as the money others owe you. After that, think about both long-term and short-term financial goals you have and what you can do to achieve them faster. Talk about how much both of you make, see how you can improve your money management skills, and think of the ways you can make extra income, too.
Remember that small actions add up
Money advices:: Saving $15 dollars each week may not sound like a lot, but over time, this repeated action can result in thousands saved in your account. Imagine what you can do with all the money you’ll have saved up in say, ten or fifteen years. You could buy something you’ve always wanted to have or help secure your elderly parents. Therefore, don’t try to keep up with the Joneses and instead focus on your long-term goals. This is called delayed gratification, and it’s one of the steps many consider to be the key to financial security.
Make your money work for you
Earning extra income and saving up for the future are two important steps towards financial stability, but another big step you can make to get closer to your financial goals has to do with investing. Start by investing in 401(k) and Roth IRA, and be sure to automate your savings so you don’t have to transfer the money manually each month. Consider learning about real estate investing, too – there are numerous pieces of money advices on how to invest in real estate with no financial input. Educate yourself and make your money work for you so you can avoid facing financial struggles once you retire.
Keep yourself and your family protected
Although it tends to get put on the back burner, insurance is something we should keep high on our list of priorities. We want our children, spouses, or parents to be financially secure, which is why protection from financial losses is important.
The insurance industry is rapidly growing, with Singapore ranking seventh in the Asia-Pacific region when it comes to gross written premium. For citizens there, getting Singapore life insurance is a connected financial experience made easier with the help of companies that aim to optimize the way the clients’ finances are managed. Digital life insurers there can help Singaporeans grow and protect their money relying on technology, helping them unlock the potential of money.
Don’t buy a house before you are financially ready for that step
Considering all the different aspects you need to keep in mind when buying a house (mortgage interest, property taxes, renovation, and of course, down payments), it pays to take a step back and evaluate whether your current financial situation allows for such big financial decisions.
The consuming process of purchasing a home may even get you thinking about whether you should buy a house or build one, so it is best to consider the pros and cons beforehand. Nevertheless, it’s one of the biggest purchases many of us will make, so before you make that important decision, make sure your finances are in order. That leads us to our last money tip…
Eliminate credit card debt
Debt is the number one enemy standing on our path to financial freedom, and one of the most frequent stressors globally.
Getting out of a credit card debt may sound daunting, but it’s not impossible. Even the sky-high balances can be zeroed out if you figure out an action plan that will help you pay off your credit cards. Coming up with the right method for your current financial situation will ensure you approach your repayments in the most efficient way possible, pay your debts off, and finally take control over your finances.
Money management skills aren’t something the majority of us learn at school. However, that doesn’t mean we can’t do it on our own. By following simple money advices and applying the rules listed above, we can regain control of our spending habits, get our finances in order, refocus our money mindset, and finally set ourselves up for a financially secure future.