We all want to live financially better and more comfortable. Considering we spend basically a third of our waking day devoted to earning an income to support our lifestyle and family then you might want to consider getting your financial health to the best possible state. It would be a shame to look at your life in a few years watching your pay packet disappear and not knowing what you could have spent it on and having nothing significant to show for it.
So here are some helpful tips to improve your financial health.
1.Save your change. You would be surprised as to how much you can actually save up in a year. Let's say you save $2 per day in coins, in a year that would be $730. What you do is get into a habit of paying everything with notes. When you get the change set it aside each night and basically not touch it. You will amaze yourself what you can amass each month and how easy this saving plan is. When you have saved enough why not use it to reward yourself or your family. You could even put it towards a vacation.
2.Stop spending your raise. The reason people are in so much financial hardship is that each time they get their annual raise they miraculously increase their lifestyle and spending to match the increase in salary. You will never improve your financial health if you keep spending. So the next time you get a raise or bonus, instead of spending it either increase your automatic savings plan or deposit it directly into a savings account.
3.Pay of your debt. You can't possibly improve your financial health if you are loaded with debt. You need to write your current debts down on paper, work out what the minimum monthly payments are and use that to work out how many months it will take to pay of each debt. Now look at this sheet and choose to start paying of the one with the lowest balance of first as quickly as possible. Some financial commentators suggest paying of the highest interest debt off first but by paying of the smallest debt balance of quicker, not only have you got one less creditor to worry about but it will also give you a victory that will encourage you to keep on with the plan. Remember to cut up your credit cards when you finish paying of your debts, you would be financially better off paying with cash in the long run for purchases. During this debt repayment period put your card in the freezer, that way you aren't increasing the debt burden but you still have access to your cards for emergencies.
4.Negotiate better rates on your credit cards. Your credit card is probably the biggest burden to your financial health. Not only is it tempting with the ease at which you have access to credit but its convenient. If you have multiple credit cards you need to consider transferring the balances to one and cutting up the rest. Get rid of your store cards as the interest they charge is ridiculously high. The next step to getting your credit cards in order is to just call your credit card provider and ask them for a reduction in the interest rate. You will be surprised at how accommodating they are especially if you are suggesting that another credit provider is offering you a better rate.
5.Get rid of your little habits. You will be surprised at how much you are spending daily on coffee and lunch. Whilst it might seem small and insignificant in isolation when you add up your lunches and coffees over a full year it can really get out of hand. You would be better off making your own lunch and just either making your own daily coffee and putting it in a flask to take to work or cutting the caffeine habit out of your life. Lets say coffee and lunch once daily costs you $10 a day. That $10 per day multiplied by 5 times a week becomes $50. That is starting to add up considering how much that would be in a year. There are so many other little things that you could cut out of your lifestyle, consider your magazine subscription that you don't read anyway, or the cable tv cost or the weekly manicure.
6.Reduce your entertainment expenses. We all need a way to wind down after a long week and its easy to just decide to go to the movies or go out to dinner. While we shouldn't go as far as living so frugally as to cut out entertainment costs, there are great alternatives to spend time with loved ones and friends without blowing your financial health. Consider inviting friends over for a simply home cooked dinner. It's a lot cheaper than dining out and you'll find that people will actually enjoy themselves together in the relaxed atmosphere. Why not hire a DVD and by microwave popcorn and just spend the night in at home. All of these are great ways to cut your entertainment expenses that can go towards reducing your debt and getting you back to a better financial position.
7.Start a savings plan. Once we have a debt under control and our spending in check you are going to need to start a savings plan. The simplest savings plan is just to open up an account that provides you with a higher interest rate than an ordinary everyday account. What you can do is then setup up an automatic direct debit system on it to take out regular amounts directly out of your paycheck. You then force yourself to live off what ever remains on your everyday account balance for bills and living expenses. After a while you won't even notice the money that is taken out for your savings. You don't miss what you don't see. This is a great way to save up for your future financial health and when the account gets large enough you can think about putting it towards any number of investment vehicles like an investment property, shares or something similar. Just be sure to get professional financial advice before making any big decisions.
