If you want to start working on your finances this year but don’t know where to start, we have five money habits that can help you to begin to make monumental changes the way you spend and save your money!
1. Save a portion of your funds
Having a savings account enables us to “live free.” When you don’t have an emergency fund, back up money, or savings account, you end up being tied up to the money you are making monthly. Not to mention you can’t build a future when you have no money in the bank.
2. Stick to a budget
If you don’t learn how to plan a budget and stick to it, you may be too far into your bad money habits. Start becoming familiar with your budget and sticking to it to run your finances instead of the other way around!
3. Cut convenience costs
What exactly does this mean? It means putting an end to paying for the convenience factor in our lives. Instead of running to Starbucks (even though it is extremely tasty) for coffee, make a cup of coffee at home. You’ll end up saving so much money that you can use for other important things you have planned.
4. Only use a credit card when necessary
If you already have a credit card, you need to be smart about using it. If you’re not using your credit card wisely, it will become a burden to you. They can be great for building credit, but not so great as a for whenever you want to buy something you don’t really need. It’s often helpful to start developing methods on how to spend funds only when you have the money in hand. Staying out of debt is always a smart move.
5. Never owe someone
Mixing money and relationships or friendships is never a good idea. Just like with a credit card, if you don’t have the money to buy something then you shouldn’t be spending the money. This is a basic rule to remember in your 20s and for the rest of your life. You’ll get to keep your relationships and pride.