3 Ways To Become the Master of Your Money

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(Newswire.net — April 27, 2021) — When you don’t have enough or you can’t seem to manage the money that you do have, it can almost start to seem like it is some kind of force that is out of your control. Often, people do not learn much about personal finances from either their families or school or in some cases, they have been taught bad habits that they must unlearn. Other people find thinking about money and their financial situation stressful. However, you can start getting savvier about money with a few simple principles that will put you on a path to mastering your financial future.

Overhaul Your Finances

The first thing you’re going to have to do is get a clear picture of what you have, what you owe, and how much you have coming in. While this might seem tedious, there is real power in knowing exactly what you are spending. The easiest way to do this is with an app that will track your spending. Be sure to use it for at least a couple of months, if not longer, to get a realistic idea of where your cash is going. The next step is to make a budget based on this information. This includes finding places where you may be overspending, but leave some wiggle room as well. Remember too that some expenses are occasional, like haircuts, or annual, such as property taxes and birthday presents.

Saving and Paying Off Debt

The next thing you need to do is create an emergency savings fund with enough in it to pay at least three months of expenses while also paying down your debt. This could mean you’ll need to find more ways to save money. Get on the phone with your auto and home insurance companies and see if you can secure lower rates. You could also look into a student loan consolidation. A private lender might offer you lower payments. This could mean savings each month. You’ll need a plan to pay off this and any other debt. As part of this plan, you may want to prioritize credit card debt since it probably has the highest interest rate.

Set Your Goals

Once you have made progress at building an emergency account and paying off your debt, you should think about some of your other goals. You should already be putting away money toward retirement, but maybe you will want to start investing in other ways as well. Apps make it easy for almost anyone to dip a toe in the investing world without much money or experience and learn as you go. Two other common goals are saving up to buy a house and saving for your children’s college expenses, but everyone has individual goals. This is about mastering your money, so think about what would truly make you happy. Is it retiring at 50? Is it buying a boat and taking a couple of years to sail around the world? Maybe you want to start a business or go back to school or start your own foundation. The key is to remember that your money should work for you and not the other way around.