Easy Financial Tips you can apply from now

One of the most important things when it comes to financial organization and life comes with saving. If you need to invest some money in stocks or get some extra money for your next vacation or even for your retirement plan, you NEED to save.

In this post, I share with you some of the methods that I have learned during the last months. These are actions that can take place once a month or even twice.

To start with, let’s keep in mind how many times a month you get a paycheck. Some people get paid twice a month. Other weekly or even daily but for most it’s usually once a month. Apparently, many people have the urge to spend money as soon as the paycheck hits the bank account. This would be the manifestation of our weakness jumping like a lion over the well-deserved money you earned. Be aware of the instant gratification. The more you disregard your longer-term interests (like moving into a nicer flat) in favour of immediate gratification (like that amazing coat you saw the other day), the more complicated it will be to meet your long term financial goals.

So, one of the tips that I have read about for at least a thousand times already is…

Take 10/30 % of your paycheck and leave in your account

Of course, this depends on how big your salary is and what is the percentage you can really put aside. Be honest with yourself and met this new requirement every time you get your paycheck.

This way, you will not find yourself jumping over your money after securing a few bucks on your account.

Another tip I have read about a few times and some over spenders swear by is the one based on paying yourself 10 % for every transaction you make.

Some banks charge you for every time you use your card. Some entities charge you for every time you withdraw money. The purpose of this one is to pay yourself too every time you “give away” your money. This way, if you are ready to pay someone else for a cup of coffee or a new jacket, then you can pay yourself 10 % of the transaction because you made that money in the first place.

This is a great way to save money if you are a big spender, specially because apart from saving some cash, you will think twice before buying something as every transaction you make will be 10% more expensive.

Another way of controlling your expenses is budgeting

And I don’t mean budgeting for a few expenses, but for everything.

So you got a salary of (amount). Then, you set apart the amount of your rent/mortgage. Now, set apart the amount you consider you need for transport. Now, separate another amount you will need for food, another for eating out, another for new clothes, for personal care, etc…

If you are doing well, you could set apart multiple amounts of savings but if you need to save a lot of money in a short time, my advice would be to set an amount separate for the basics and essential needs. If you end up spending more, you would need to have a really good reason to do so and probably pay yourself 20 % of that transaction.

One of the last ideas I heard was to mark in a calendar the days you don’t spend money at All. This means that you don’t buy absolutely anything and put some sticker in the calendar as a reward.

And finally… My beloved budget tracker!

As some of you might know, I control my expenses every day and after the month is over I check where my money goes. You can use an Excel for instance (like the one I gave away in one of my previous posts) to use it yourself if you think it can help you control your expenses and improve your financial situation. I am happy to say I still use this technique. I had control of each of my expenses from 2018 and I came to the conclusion that despite improving my financial habits, I still need to improve so much… and I did spend quite a lot on clothes and eating out.

And the best thing you can do after you have been tracking ALL your expenses for 1 year, or even 6 months is to do a self-analysis. Where has your money went after 6 months? Are those things making you happy? Is your life better now after having those items?

I bet that some of the items you bought are an amazing addition to the house of your dreams, but you might be surprised to see how many of them are just wasted money, frugal things you don’t use or don’t add any sort of value to your life.

And maybe, just if you want to make things different, you could use that money to invest it in something else. Maybe your dream is to spend a whole year cycling through Europe, or you prefer paying a few years of your mortgage in advance and minimize the amount of interest you owe to the bank.

The problem is that if you don’t control where your money goes, you can’t change your consumer habits.

What is your best financial tip? Let me know in the comments section!