There are many challenging aspects to life. For some people, it could be that they have relationship troubles; for others, it could be that they’re not sure what to choose as their career. And for some people, it’s money. Actually, this is something that many people — actually too many people — worry about.
In the meantime, let’s focus on improving your personal finances. While this can be a long-term ambition, you don’t necessarily need all that much time to nudge things in the right direction. Indeed, if you can give yourself six months, then you might just find that you’re able to significantly improve your financial standing.
And the best part? None of the actions that you have to take are particularly difficult. Below, we’ll run through ten tried and tested tips. Incorporate them into your life, and it won’t be long before you notice that things have been improved.
Where Are You?
Your first step will be to get a clear overview of your finances. After all, you can’t figure out how you’re going to reach the top of the mountain, if you don’t know where you’re starting from. Taking some time to figure out your financial standing will bring a couple of benefits.
First, it’ll tell you what improvement will look like for you on a personal level, since everyone’s situation is different. Second, it’ll expose any great mistakes that you’re currently committing. Sometimes it’s only when we dive deep into our finances that we realize that we’ve been wasting money and causing our financial situation to be jeopardized.
Set a Target
One of the most effective yet undervalued tactics when you’re trying to make improvements is to set a target. This is true for more or less everything; if you want to improve your fitness, you should set a target. If you want to improve your finances, you should set a target.
This is an effective tool because it gives you something to aim for. Some people periodically tell themselves they’re going to improve their finances, but once that initial burst of enthusiasm has faded, they end up abandoning their mission. If you have a specific target in mind, then you’ll be much more likely to continue working towards improving your situation.
The most effective way to improve your finances is to cut your costs, where possible. And the good news is that depending on where you’re at with your finances, this will be possible. If you’ve taken a look at your money situation, then you’ll probably have found that you spend more money than you thought on non-essentials, such as coffee or takeout food, or socializing.
A little bit of mindfulness when it comes to these expenses can be highly beneficial, since it might stop you from inappropriate spending. You’ll also want to look at other areas where you could cut costs, for example, your cable or internet bill. You don’t need every cable channel, and you probably don’t have to pay for the fastest internet available. A second-tier plan will work just as well unless you’re a heavy bandwidth user.
A Frugal Month
One complication that can disrupt a person’s plans to improve their finances is that, well, people like spending. They like going out, buying things for themselves, and so on. While you’ll have to limit these kinds of financial transactions if you want to improve things, you won’t want to get rid of them forever.
And so you shouldn’t — life is for living, after all. However, if you want to improve your finances, then it’s worthwhile looking at temporarily pausing non-essential payments. If you can give yourself one month to live on a shoestring budget, then you’ll find that your bank balance is seriously boosted — indeed, you might even be surprised by just how healthy it is looking.
Get Rid of Debt
It’s impossible to be financially healthy if you’re carrying a lot of debt. In some cases, such as when you’re only paying off the interest rather than the debt itself, debt is the shackles that really hold a person back from reaching their full potential.
While debt is one of those things that can feel impossible to overcome, this is not the case. There are organizations out there that can help you, so you don’t have to go at it alone. To get started, take a look at this Debt to Success System review. You’ll feel energized just knowing that you’ve taken action, and it’ll have a real, long-lasting effect on your finances too.
Invest In Yourself
We’ve mentioned the benefits of cutting costs and even living a frugal life. However, it’s also important to remember that there are some areas of life where you should spend money, such as yourself. By investing in yourself, such as by paying to complete a course that’ll allow you to apply for better-paying jobs, you’ll be ensuring that you have a bright financial future.
Building a Safety Net
If you’re going to work hard to improve your finances, then you’ll want to prevent anything from happening that could push things back into a negative state. One such thing could be an unexpected expense. So look at building a safety net. If you have $1000 for emergencies, you’ll be able to avoid falling into debt for unexpected reasons in the future.
Could you put your assets to work? Renting out your vehicle, offering rides for journeys you were already making, or renting out a room (or parking space) at your property can be a useful source of income.
It’s bad enough when we put ourselves into financial difficulties. It’s worse when other people do it for us. One problem that many people have is that they don’t know how to say no to people. If your friend wants to have a birthday experience that’ll cost you $200, then you’re not duty-bound to say yes.
You should only spend the money that you’re comfortable spending. We’d all like to go to a destination wedding, but if it’s going to cost the equivalent of a month’s salary, then you’ll have to say no. Of course, this can be a little tricky, since saying no isn’t a skill that everyone — or even many people — possesses. But you’ll find that learning the art can bring a lot of benefits into your life.
Finally, the last way to use these six months of financial improvement is to develop new, positive financial habits. While people can be held back by their income or other financial responsibilities, a lot of it does come down to personal money habits.
So look at replacing any old habits that weren’t good for you with ones that are. This can take a bit of time, and requires some self-discipline too, but over time you’ll find that they’ve just become part of who you are — and that your bank balance thanks you.
While it may take years to achieve real financial freedom, you can get things moving in the right direction in as little as six months, as we’ve seen above. So give it a try. Even if this only marks the beginning part of your journey, it will provide a solid platform — and that you’ll learn a lot along the way.
KT is a digital nomad who quit her job, bought a ticket somewhere, got a tan, fell in love with mother nature and she would never return to the normal life that society dictates. You can also connect with her on YouTube, Facebook, Twitter, and Instagram: @pinaynomad