One of the most important things to understand about having a healthy financial situation is to be proactive about it. Taking the time to manage and understand your money is essential when developing your personal financial best practices. If you truly want to manage your money and master your spending in the most effective way possible, here are a few key things to keep in mind.
6 Money Management Tips to Improve Financial Literacy
Examine Your Financial Picture
The first step towards properly managing your money is to assess your current financial situation. To put it another way, you can’t get a true sense of where you’re going if you don’t know where you’re starting. This means that you need to know what your income is and what your expenses are so that you can take the proper steps to make the necessary changes.
Make a Plan
Once you’ve taken the time to assess your financial picture, it’s time to make a plan for what you aspire to accomplish. Maybe you’re saving up for a new car, or for the down payment on a new house. Prioritize what is important, and set actionable, measurable goals to keep yourself accountable down the line.
Examine Your Debt Carefully
Make sure you fully understand your debt situation. If you have not done so already, you should begin to chip away at your existing debt whenever you can. Tools such as the “How soon can I eliminate my debts?” calculator as well as the other financial calculators we offer can help give you insight into how long it will take to get debt-free.
Create a Budget That Fits Your Lifestyle
Another important step in money management is to create a realistic budget that you can stick to. Review your current expenses to see if any can be trimmed. This may mean eating out less often or cutting ties with those extra streaming services.
Save, Save, Save
It is never too early to start saving. At a bare minimum, start to build an emergency fund to help better prepare for any unexpected expenses. Likewise, it’s never too early to start saving for retirement. Try to set aside a percentage of the money you make each month and use it to “pay yourself” by way of your Field & Main savings account. If you’re expecting a tax refund, another stimulus check, or a raise at work, keep in mind that these are great opportunities to boost your emergency fund and savings efforts.
The Importance of Regular Follow-Ups
There is no solution for managing your money – this is not something you just do once and forget about. Best practice includes having regular check-ins with yourself to see how you are doing as you evaluate your financial progress. Your financial goals, wants and needs will change over time. Perhaps the goals you originally made are no longer a priority, and that is okay. Changes happen and you can adjust your plan accordingly. If you are interested in taking your financial goals a step further, explore what a Field & Main Wealth Advisor can assist you with turning your hopes, dreams, and goals into financial plans with purpose.
Start Managing Your Money Better Today
Life can be unpredictable. Allow yourself some flexibility when it comes to managing your money. You need to manage your money – don’t let your money manage you. If you would like to talk about your finances and how Field & Main can assist you, contact us today!