Figuring out your personal finances is tough. If you do not know what you are doing, it can be pretty impossible. If this sounds like you, then keep reading. I have 3 tips to help you get back on track with your personal finances. Here they are:
1. Create A Monthly Budget
Creating a monthly budget definitely has the potential to become a daunting task, but if you take it step by step, it hopefully will not seem so overwhelming.
The reason that creating a monthly budget is so important is so that you are able to see where your money is going each month. Also, you are able to fine-tune that budget to work for you.
So, maybe reviewing your expenses each month allows you to see that you spend way too much money eating out. Instead, you can spend some of that money on paying off your cards, or other bills that may be making your life a bit more stressful.
Every Dollar says that you should use a zero-based budget.
They say, “This doesn’t mean you spend until your bank account hits zero. It means you’re giving every dollar a job to do.
All your income should have a place in your budget. Every dollar should have a job to do.
To get technical again, this is called zero-based budgeting. It’s one of the most eye-opening ways to see how you spend your money so you can start spending it in more effective ways. In other words, you can make your money work for you instead of the other way around.
You get a zero-based budget by putting in all your expenses until you reach zero:
INCOME – EXPENSES = $0
If there’s still money left after you’ve entered your fixed, variable and discretionary expenses, put it toward your current money goal. You can knock it out that much quicker. Jab. Cross. Success.
To help you know when you’ve reached a zero, we announce it proudly at the top of your screen: “It’s an EveryDollar Budget! If you see that, celebrate. You just budgeted to zero.”
2. Reduce Spending, When Possible
Once you figure out your budget, your next step will be to figure out how to reduce your spending, when possible. So, do not think that you can just create your budget and let it be. Instead, you need to be attentive to your budget when you create it and throughout the month, as well.
Luckily, it is not that hard – you just have to track your expenses. When you buy something or pay a bill, do the math and figure out how much you have left to spend on that category. Put all of these into your budget (using an excel spreadsheet is great!) so that you can physically see the updated numbers.
Doing this throughout the month, instead of just at the end of each month, is very helpful so that you are not surprised and instead, you can adjust your budget as you go along. This is especially helpful when you have an unexpected expense.
Life happens, but you should hopefully be able to plan for it (a bit better) once you get your personal finances on track.
3. Pay Down Credit Card Debt
Speaking about unexpected expenses, one thing that you do not want to have to deal with is credit card debt. So, when those unexpected expenses arrive, try not to put them on your credit card(s). Especially if you are already dealing with high balances.
Paying down your high-interest credit card debt is very important because a lot of your money is going towards interest when paying the minimum balance each month. In fact, if you are just constantly paying the minimum balance, I can almost guarantee that you will not get them paid off.
Instead of doing it this way, come up with other creative solutions to help you get them paid down faster. For example, you could find ways to make extra cash on the side (babysitting, selling your old clothes, pet sitting, or using your talents to your advantage) to help pay them off.
Collateral Loan – Chapes-JPL
One example of this is getting a collateral loan. The reason that collateral loans are so helpful when it comes to paying off high-interest debt is that 1) they are usually short-term and 2) they are typically low-interest, but in order to achieve both 1 and 2, you need to find a good company.
Chapes-JPL is the best option that I have found in Atlanta. They are located in Buckhead and offer short-term, low-interest (as low as 3%) collateral loans on your valuables such as jewelry, gold, handbags, and they even give car loans!
Chapes-JPL has one simple goal: to provide affordable asset loans on jewelry, gold, diamonds, watches, and other valuable assets, at a low rate and at a fair value. They offer loans as low as $100 and as high as $5 million. Since these loans have low interest rates, it is much easier to pay them off compared to a high-interest credit card, which is why I always talk about them being a great option compared to credit cards.
There you have it – a few ways to get on track with your personal finances! There are so many other ways, but these are just a few options. Make sure to check out how I was able to manifest $2,000 in 21 days here. What other tips do you have?