Managing personal finances can often be difficult when it comes to making smart purchases and saving for emergencies. Although most people often acquire debt throughout their lives due to poor money management skills, there are a few key tricks to practice to ensure that you’re smarter with your income.
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Use cash
As the old saying goes, cash is king. Whether purchasing groceries at the supermarket or filling up on gas, you’ll naturally avoid impulse spending throughout the month by using cash.
Although plastic may be more convenient and is easier to carry, it’s difficult to see just how much you’re spending without physically seeing the money in your hand. A study performed by Dunn & Bradstreet found that people naturally spend at least 12 percent more when using a debit or credit card than resorting to cash.
Create an envelope system
Budgets are essential to creating monetary goals and spending within your income, but sometimes, all it is to people is numbers on paper. Take the extra step with your self-discipline by using separate envelopes for each expense and putting the cash that you have for that expense in the envelope.
Once the money runs out, it forces you to wait until your next payday to spend more.
Schedule automatic payments on bills
It can be easy to make late payments on a number of bills when getting caught up with life and managing other responsibilities. Avoid late payments by scheduling automatic transfers that will ensure that you remain a responsible customer and that your credit score is not affected.
When paying rent or a service, opt for a money order transfer for a quicker method of making the payment on time.
Create several emergency funds
Emergency funds are the modern-day version of a rainy-day fund and work to cover unexpected costs that can be related to car repairs, medical expenses, or even to pay the bills due to a job loss. Work to save at least $1,000 for an emergency fund, while also saving at least three months of income if a job loss occurs.
Managing your money is not an innate skill that comes easily, but often must be learned over time for habits that will ensure financial stability. It will work to prevent mistakes or loss from occurring for less stress and more peace of mind.
About the Author:
Savannah Coulsen is a freelance writer. She lives in Raleigh. Savannah loves to read and write, and she hopes to write a novel someday. Savannah also loves learning and is a self-proclaimed health guru. Savannah got the idea for this post from Woodward Check Cashers, a company that specializes in Money Order Transfer in Detroit.
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