Halloween is a matter of days away, which means that Christmas will be here before we know it, and then it will be 2017. Is it me, or did this past year go by way too fast?! Although we’ve got a while yet, some of you may already be thinking about what your new year’s resolution will be. If there’s one resolution that I hear year after year, it’s to be better with money. As you probably know, this is often easier said than done! If you want to have a better hold on your personal finances, then here’s a few good habits you can get into now.
First of all, try to keep your budget simple. We live in a world that’s obsessed with technology, and I’m sure this isn’t going to change when the new year rolls around! When our day to day lives are so centered around technology, it can be easy to go all-out on all the financial apps and tools you have available to you. While a lot of these tools can be very handy, they’re often a double-edged sword. When you’re dividing your personal finances into countless categories and subcategories, the whole issue can become over-complicated, and you may end up running yourself into all kinds of ruts. Go with a more minimalist approach, and you’ll find it so much easier to stick to your budget.
Next, try to set yourself some passive spending barriers to ensure that you’re not going over what you can realistically afford. Here, I’m talking about getting into a few good financial habits which will help you establish various money-saving rules for yourself. One great routine is getting your monthly paycheque, then writing out a thirty-day list of all the things you want, and then going back over it with the “two items out for every item in” rule. If you’re used to going over budget and living with various luxuries, then sticking to this habit can be a little hard to begin with. However, gritting your teeth through it all will save you money, and develop the discipline it takes to say “no” to some of life’s luxuries. The next time you’re finding it hard to wave away something you want, think about something larger and more enjoyable that you could be saving up for.
Next, max out your retirement savings. Again, this is one that’s easier said than done. Perhaps you would have done it already if your personal finances were in a better position. Still, the closer you can come to maxing out your 401(K) and your Roth IRA, the better off you’ll be in the long run. Whether this habit is realistic for your income or not, it’s important to start saving for it as early as you possibly can. Even putting away $30 a month will add up over time. This is even more important to do if your work runs a retirement scheme where they match the contributions you make. Neglect to take advantage of this, and you’ll essentially be turning down free money!
Automating some of your transactions is another great way to make sure you’re being smarter with your money. This isn’t really a habit, true. However, it’s a great way to ensure your personal finances don’t become too chaotic. When you have many of your payments and savings made automatically, you’ll eliminate the risk of shooting yourself in the foot with impulsive spending habits. Furthermore, when you’re all set up with automatic payments and savings contributions, you’ll have a little more time to focus on other areas of your personal finances. When investments, bill payments and so on are already taken care of, the rest will be far easier to organize.
Finally, get into the habit of looking at the big picture, and questioning every little transaction that you make. Before you finalize any purchase, take a moment to think about your long-term goals, and your personal values. If you bypass this, you can easily end up spending too much of your hard-earned money, or simply squandering it on all the wrong things. The more you do this, the more it becomes a knee-jerk reaction triggered by you touching your credit or debit cards. Soon enough, you’ll wean yourself off of impulsive, unnecessary purchases, and naturally invest more in your career and earning potential.
I hope this guide eventually makes money less of a worry in your life. Take on just a few of these habits, and soon enough you’ll notice a considerable, positive difference to your personal finances.