10 Ways To Take Control Of Your Money
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As much as everyone wants to start taking control of their finances, a lot of people have no idea where to begin. There are so many ways to start saving, investing, and cutting back, but it can be so overwhelming that people just don’t start. Don’t let that be you! No matter where you are at in your financial independence journey, you must start somewhere. Even if you are 60 years old and have no savings, you can start today.
The idea behind these tips is to help you begin your journey on financial independence by taking a few small steps. Some of these tips may seem impossible, depending on where you currently are in your journey, but just start with one or two. Once you have those down, move on to another tip to tackle. Some of the tips may take you awhile to master, but the point is to start with one or two. Just completing one of these tasks will move you forward.
Here are ten ways to start looking at your money and taking control of it:
1. Increase 401(k) contribution
It’s important that if your company offers a 401(k) match, you at least contribute enough to get that match. Each year, you should also increase your contribution by 1%. You shouldn’t notice the difference each year, but it you will notice the difference in your 401(k) after a few years!
2. Automate savings
The best way to save is to direct deposit your paycheck so that you aren’t tempted to spend most of it when you receive it. By automating your savings, you have a better chance of not spending it and letting it grow in your account.
3. Additional payments towards debt
This goes without saying, but any credit card or student loan debts should be the first debts that you pay off, depending on the interest rate of the loans. You may not realize that just paying the minimum monthly payments will not make a big dent in your debt because the total amount you owe may continue to increase each month, depending on the interest rate.
Check the interest rate for each loan and start putting an extra $50 or $100 per month towards the loan with the highest interest rate. That amount may seem like a lot, but think of it as money that you would have spent going out to dinner one night with your spouse/partner or the money you would have spent on some new shoes or clothes. Paying extra on high interest rate loans goes a long way in getting you out of debt quicker.
4. Start a net worth spreadsheet
This step has been one of the most important things that my husband and I have done to figure out where we stand with our money. Before this spreadsheet, we were flying blind and didn’t know how much money we were saving. Now that we have this spreadsheet, we can track how much money we have saved/earned the past few years.
5. Start tracking your spending with Expense app
If you want to start saving money, you first need to know where your money is going in order to figure out where you should be cutting back. I downloaded the Expense app from the Apple store and have been using it for the past few months to track expenses.
It is sometimes tedious and when I get the alert on my phone asking me if I tracked my expenses today, I sometimes get annoyed. Doing this exercise each day, though, makes you think about what you are spending your money on and helps to create a log of your expenses over time.
6. Check credit card/PayPal for automatic payments/subscriptions
You could be paying for a subscription or membership every month that you no longer are using. Take a look at your credit card statement or your PayPal account and see if there are any reoccurring charges.
Here are some examples of subscriptions to look for:
- Online groups/forums/membership sites
- Netflix
- Gym memberships
- Magazine or newspaper subscriptions
- Premium cable channels or services
7. Shop at the discount grocery store and use a grocery list
As much as I love Whole Foods and the various specialty grocery stores, our family does the majority of our shopping at the local discount grocery chain that prices products at least $0.50 to $1 less (minimum) than the big chain grocery store. They carry brand name items, but they also offer closeouts, such as deeply discounted toys, gifts, housewares, etc.
Never go to the grocery store without a list. We used to make this mistake and ended up buying a lot of junk food and convenience foods that we didn’t need. Now I print out a list based on a menu that I create using Once A Month Meals. I just started using the service in June and love the simplicity and options available for various meals, such as Instant Pot meals, crock pot meals, or meals in the oven.
8. Coupon apps
Download coupon apps, store apps, and apps that pay you money after shopping on your smart phone and you will be able to save every time you go to the store. Here are some great ones that I use:
9. Cook dinner at home
Cooking at home is one thing that our family has to work on. There are some weeks we are bad about eating dinner at home, but with our son’s busy sports schedule, it ends up that we may eat fast food a couple times a week.
I love the Once a Month meals that I have made, but I have made them for the Instant Pot and my husband doesn’t know how to use it, so everyone needs to wait for me to get home to cook those meals.
10. Start an emergency fund
According to an article on The Motley Fool, the median savings account balance across American households is $4,830. If you end up losing your job, you should have enough savings to be able to pay expenses for at least 3 months. That $4,830 won’t last 3 months if you have a family to support and bills to pay.
You’re probably asking yourself how you can save 3 months of expenses when you might be living paycheck to paycheck. First, you need to review your budget and expenses (step 5 in this article) to see if there is something that you can cut. If you have found something, then you can take the money you were paying for the expense and put it into savings each month.
Another way to save more money is to increase your income with a side hustle or working overtime (if you have that option).
Just start with one of these steps and master it. If you questions, feel free to leave a comment.
