STRAIGHT FACTS About Spending, Saving, And 25Making Money
There is so much conflicting and confusing information about spending, saving and making money that it s hard to know which way to turn! Here are some straight facts to help you get a glimpse of your finances from the right perspective. 2
1. SPEND LESS THAN YOU EARN. This isn t rocket science, but in today s credit-crazed society, we tend to forget this basic financial principle. But it s key to your financial health. 3
2. GIVE BACK A PORTION OF EVERYTHING YOU MAKE. There s a saying that says you reap what you sow. Sow generosity and it ll be returned to you ten-fold. Ten percent is a common measuring stick for philanthropic giving. But whatever amount you choose, give something to others in need. 4
3. WORK SMARTER, NOT HARDER. You may think this adage applies only to those in business for themselves, but that s not true. Everyone can get more done in less time by focusing on the task at hand and striving for greater efficiency. 5
4. ELIMINATE DEBT AS QUICKLY AS YOU CAN. Too many credit cards and other debts can drag you down financially to where you may never recover. Work quickly and diligently to reduce and ultimately eliminate your debt for the sake of your future. 6
5. LIVE LIKE NO ONE ELSE, SO YOU CAN LIVE LIKE NO ONE ELSE. Dave Ramsey s mantra makes a lot of sense. Live more frugally today and save as much as you can so that later on you can live a freer, more comfortable lifestyle like no one else! 7
6. PLAN FOR YOUR FUTURE. Financial planning is the key to financial security. Decide today how you can best prepare for your future and begin to work your plan. Consider short term and long term savings, retirement accounts, investments, and so on. 8
7. SAVE SOMETHING EVERY WEEK. It doesn t have to be a huge amount, even $5 or $10 a week will add up over time. But start today to save something from every paycheck. 9
8. THERE ARE TWO WAYS TO INCREASE YOUR FINANCES: MAKE MORE OR SPEND LESS. While it s easy to get sidetracked with all kinds of financial dreams and plans, this underlying concept applies to every aspect of your budget. Need more money? You have to spend less or earn more. There s no other way around it. 10
9. TRACK YOUR EXPENSES. If you want to know why you don t have more money left at the end of the month, keep a record of every penny you spend. Finding the financial leaks in your budget shows you which holes need to be plugged. 11
10. USE COUPONS ONLY FOR ITEMS YOU BUY ANYWAY. Think coupons are the be all and end all of saving money? Wrong! Coupons can cost you if you use them unwisely. Often a coupon will entice you to buy something you wouldn t normally buy (that s the manufacturer s goal). Don t fall into this trap! 12
11. CALCULATE HOW MUCH A SECOND INCOME REALLY COSTS. It s easy to think that getting a second job or a spouse returning to work is a good solution to money needs. That may not be true. Consider the added costs of child care, lunches out, transportation, work clothes, and other expenses before you decide it s the right choice for you. 13
12. EATING AT HOME IS THE GREATEST SINGLE THING YOU CAN DO TO SAVE MONEY. Most families eat out an average of three times a week. For a family of four at $7 a person (which is cheap!), that s over $80 a week. You can almost feed your family all week for that amount! Dine in and save your money. 14
13. TURN YOUR HOBBY INTO CASH. Rather than take a second job at a convenience store, you can easily turn what you enjoy into a second income. Sell collectibles on ebay or Craigslist. Sell handcrafts or baked goods. Write articles. Whatever you do for fun, turn it into cash! 15
14. BECOME A SAVVY SHOPPER. Learn to recognize good value, good prices, and a good sale when you see one so you re not lured into thinking you re getting a good deal when you re not. 16
15. FRUGAL DOESN T HAVE TO MEAN CHEAP. Living frugally means conserving and spending less, yes, but it also means getting the most for your money and making your money work for you. Learn the difference and put aside cheap thinking. 17
16. LEARN TO INVEST. While you may not want to become a stockbroker, investing in exchange traded funds, real estate, gold, and more will help you increase your net worth without the need to get a second job. Wise investments can pay off in big ways. 18
17. THINK PRE-NUPTIALS ARE ONLY FOR THE RICH? THINK AGAIN! While you may not be wealthy today, you could be some day. Having a prenuptial agreement can preserve your future income for your children in the event of divorce. 19
18. START AN EMERGENCY FUND. This isn t a regular savings account; this is savings that you never touch except in an emergency. Ideally, you should have enough money in the bank to cover six months worth of expenses in case you lose your job, are disabled, or face another life emergency. More is good. 20
19. SET FINANCIAL GOALS AND WORK TOWARD THEM. Want to retire in ten years? Want $100,000 in the bank? Want to save enough to pay for your child s college without getting a loan? Plan for it now! Write down your goals and work toward them. 21
20. PREPARE FOR THE UNEXPECTED. What would happen to your family if you died? With a good life insurance policy, they would at least be provided for financially. Too many people neglect planning for their family s financial future and have inadequate life insurance. Don t be one of them. 22
21. BUY ONLY WHAT YOU REALLY WANT OR NEED. This sounds like a no-brainer, but so many times we come home from the store lugging purchases we will never use. Stop yourself before you buy another outfit you won t wear or gadget you won t use! Your budget will benefit greatly and your home will be less cluttered. 23
22. DON T SPEND MONEY ON WHAT YOU CAN GET FREE. There s no need to join a health club when you can walk, ride a bike, go hiking, or play ball with the kids for exercise. The same is true of many other things we spend money on... car washes, lawn care, and more. Break the cycle of spending from habit rather than need. 24
23. NEVER BORROW MONEY TO KEEP UP WITH THE JONESES. If your income doesn t allow you to buy a new car, keep driving the old one until it does. Never go deeper into debt because you want to make a good impression on someone. 25
24. AVOID LIPSTICK THERAPY. There s a psychological phenomenon where people will buy something small (like lipstick) when money is tight because of the comfort shopping brings. Pay attention to your spending habits and avoid this money pit. Small things can add up to big expenditures before you realize it. 26
25. TALK OPENLY TO YOUR PARTNER ABOUT MONEY. Money problems are a leading cause of divorce, and it s easy to see why. Financial burdens are a heavy load to bear. But often the problem stems from lack of communication. Talk with your partner openly about your money goals, concerns, and desires. And listen as well. 27
Spending, saving, and making money affects us all. Learning more about personal financial management and financial health will add a sense of security and sanity to your life. Start today to make use of these important tips for your financial health! 28