1. Live Within Your Means
The most important way to get your finances under control is to not spend more than you earn. In fact, you should be spending far less than you earn. Money that you earn should be paying for your current expenses, but also going towards paying off debts, as well as saving for the future. Create a budget for yourself. Keep track of every expense you make for a month, and at the end of the month divide those expenses into categories, like food, gas, entertainment, etc. Add up the amounts in each category and see how much you spent. For the next month, set limits for yourself in each category, and set aside some money for debt payments and savings. When the money you have set aside in each category runs out, stop spending.
2. Get More Bang for your Buck
For most of us, the amount of money we’re bringing in each month won’t change much until we get a raise or a new job. So in order to make your money go farther, you need to remember the value of a dollar. Be smart with your spending and make each dollar count. Instead of paying more money for items at one grocery store, look through ads and visit multiple stores to get items when they’re on sale. Don’t buy one pair of name brand shoes for your child. Instead, buy a pair of generic shoes, plus a pair of pants and a shirt. When you need to buy something for around the house, check online for gently used items before purchasing them brand new. You’ll be surprised how far your money will stretch when you make the best use of each and ever dollar.
3. Pay Down Debt
The main goal of personal finance is to move from being in debt, to instead being debt-free and having a healthy savings account. Pay down your credit card debt and monthly installment loans as quickly as possible. Interest never sleeps, never takes a sick day, and never takes vacation. It accrues constantly, so pay off as much debt as possible each month. Once your debts are paid off, you’ll have all of that extra income to put towards a savings account.
You don’t have to be wealthy to have good control of your finances. Living within your means, making each dollar count, and paying down debt as quickly as possible will guarantee you are moving forward on the path to financial freedom.