When it comes to personal finances, most have difficulty with money management and making the most of their income. Money issues are the number one issue that most people will say causes them stress and sleep loss. Whether it be making ends meet or paying for unexpected expenses, living paycheck to paycheck is difficult when it comes to managing your money. Here are six ways you can make the most of your money and personal finances.
Make the Most of Your Full-Time Job
Suppose you are gainfully employed and still having difficulty making your ends meet. That could mean that you are not making the most of your full-time job. In many cases, people are making far less than what they are worth and the job they put forward. This is not because their company is unwilling to pay them more; however, they are running a business and will likely keep you at your same salary until you ask for a raise. Some companies have built-in yearly evaluations and raise potential; however, most do not exist outside corporate America.
You need to oversee your salary and go for those promotions and raises. Often, if you are a good employee that works hard and is productive, they are just waiting for you to ask or take the initiative to ask. We can count on those that manage us to push us to do those things or offer us those raises and promotions. It is rare to have a boss that offers those things without you asking.
Start A Side Hustle
If you are not crazy about your job and do not want to put in more time or seek a promotion, you can start a side hustle. In the simplest of terms, a side hustle is a job you do on the side to supplement your income. Side hustle or gigs have become extremely popular. You can be a rideshare driver, a food delivery driver, a freelance writer, a freelance photographer, and so much more. The greatest thing about the side hustle or gig job is that you pick and choose when you work and how much you want to earn. Many in-depth turning their side hustle into their full-time business. This can be done once the side hustle replaces 70% of your income.
Start Budgeting
Chances are, even if you are a financially responsible adult, you do not have a budget. Not having a budget can put undue stress on you about your personal finances. Many money problems stem from not having a simple budget. Most people think it is complicated or that a budget will point out that they must cut many things out of their life. That could not be further from the truth. A budget helps you see where your money is being spent, where you can save, and what you can live without and what you need. It helps consolidate everything in one place that affects you in your personal finances.
If you have not started a budget, you should start one today. Keep it simple. Gather everything that brings you income and gather everything that costs you money that is steadily coming out each month and figure out what your monthly grocery bills are and gas. Once you have gathered all this information, you can. Put it into a spreadsheet or use a notebook. The most important things to include are the dates that you receive income, the dates that the bills are due, the bill’s names, and the budget for the bill. You will also want to add a column that is the actual cost. Once you have a working budget, you can begin to look at ways to save money and make the most of it. If you find your expenses exceed your income, you will have to make changes in your spending or bring in more income.
Get Out of Debt
Even the most financially responsible adults will have issues with debt. This is because we are a society that largely depends on credit to make purchases. If you are diligent about paying back any loans or lines of credit you have and credit card debt, this usually is not an issue. What generally occurs to get someone in debt is that they max out their credit cards and cannot pay it back, or unexpected expenses cause the inability to pay certain bills or credit lines. To make the most of your money and control your personal finances, paying down debt should be your number one priority outside of paying your bills.
To accomplish this goal, you may have to make some entertainment sacrifices and any spending that is not on necessities. Generally, this sacrifice will be temporary; therefore, there is no excuse for you to give a few things up to get out of debt.
Plan for Emergencies
If you have no other savings in place, you should have an emergency fund. The quickest way to lose control of your money and personal finances is to have an emergency expense you cannot cover without sacrificing other bills. If you have an emergency fund on hand, it can cover you while you earn the extra money to replace the emergency fund you took out. It is suggested that you first make a goal to save $1,000, then work your way up to an amount that is equal to six months of your income. This will cover you for job loss or catastrophic medical issues. Some will take it even further and cover themselves for up to a year.
It should be noted that this is not your savings for your future or used for investments to make yourself a nest egg. Those are a separate savings plan. This fund is strictly to cover you for emergencies and loss of income due to unforeseen life events. The emergency savings fund will prevent you from getting a loan and pay interest, especially in those cases where you do not know when you’re going to have a steady income back in your life.
Avoid Impulse Purchases
Impulse purchases are something everyone confronts in their spending. While it is understandable that it is almost impossible to avoid impulse spending completely, you need to avoid it as much as possible. Most budget issues are spending money on things we did not budget for and causing issues with our other bills and responsibilities because that money must come from somewhere. A suggestion would be to build a miscellaneous category into your budget. When you get your budget completed, if you are spending more than your income, it can be a place you can cut. However, if you are well within budget, including some miscellaneous spending, then you can give in to a few of your impulses while remaining within budget.
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