Managing personal finances is no easy task, unless you’re an economist or have lots of time to devote to this process. Fortunately, there are some simple strategies you can use to ensure your finances are in order and keep more of the hard-earned income you make each year. Check out these 8 personal finance tips for your back pocket:
1. Track your expenses each month – Be cognizant of what you are spending your money on each month. We all have bills to pay like electric, water, phone, and Internet, but what else are you paying for? Are there cheaper options for your necessary expenses? Are you buying things that are more of a “want” rather than a “need?” By examining your expenditures each month, you’ll have a much firmer grasp on your overall financial situation. Consider using a spreadsheet or one of those handy mobile apps to do this.
2. Set aside a percentage of your income for savings – Take a cut of your paychecks each month to put into a savings account. Not only will this benefit you down the road, but also it will reduce your chances of splurging too much and spending money on things you just don’t need. Certain savings accounts come with interest and tax benefits, such as a Roth IRA. Explore your options and choose the best one for your personal circumstances.
3. Pay your bills and taxes on time – Not paying your bills on time can negatively impact your credit. It could also mean late-payment fees that are added on top of your actual bills. Not paying your taxes with the IRS on time can also result in late-payment or late-filing penalties. The last thing you want is to have more expenses than you already are incurring.
4. Take advantage of discounts – Cut coupons, take advantage of sales tax holidays, and be on the lookout for any discounts or rebates. Even if you save a few bucks here and there, this can add up to big savings over time. It’s also worth making big purchases at the right time, such as buying certain items during specific times of the year. Black Friday and after the holidays are often good times to enjoy significant savings. Overall, do your homework when it comes to finding good prices.
5. Keep up with your credit report and credit score – Check your credit report annually, and know what your credit score is. This information is a solid indicator of your current financial standing. Many services offer this info for free or at a low cost.
6. Find the best financial institution for your needs – There are many banks and financial institutions out there. Some specialize in offering certain services, such as those that work closely with small business owners. Find the right institution to do business with so that you are only paying for what you really need – and that your money is in a safe haven.
7. Invest in the stock market wisely – It’s tempting to invest a lot of money into stocks that are doing well or could soar in the near future. But these are unpredictable investments. So consider working with a stock broker or financial planner to ensure you are putting your money into the best stocks.
8. Review your insurance plans – Take a close look at all of the insurance policies you have – life insurance, car insurance, homeowners’ insurance, health insurance, pet insurance – the list goes on. Determine how well these plans are working for you. It’s important to insure certain things for obvious reasons, but it’s easy to become over-insured. Also, insurance protection plans are a huge revenue generator for companies that sell electronics and other items. There are rare instances when these plans may be necessary, but most of the time, they are a waste of money.
For more personal finance tips and tips for small business owners, work with the accounting professionals at 1-800Accountant. Call 1-800-222-6868 or click over to www.1-800Accountant.
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