Financial planning can seem confusing and frustrating, but it’s an essential step to take toward securing a future so you won’t have to work your entire life. Here are five things you can start doing today to set yourself up for a financial future where you can worry less about money and more about doing the things you love.
1: Create a Monthly Budget
One of the first steps toward a better financial future is understanding (and controlling) where you spend your money today. If you don’t have a budget, sit down and create one. If your finances allow it, give yourself some leeway to buy things like new clothes or to go out to eat, but make sure you’re staying within the budget and spending more than you earn, which puts you in debt.
2: Avoid Debt
Paying off your debt, and staying out of debt, is essential for financial security. Interest payments on credit card debt, store cards, student loans, and even cars and your mortgage can quickly suck up all your extra income. Once you have balances paid off on credit cards and other revolving accounts, start setting aside a little extra money each month to put toward your mortgage or pay off your car faster so you pay less interest to the bank over the life of the loan.
3: Start a Savings Account
Savings accounts can provide you with a financial cushion in an emergency and provide a vehicle for increased income or retirement. If you’re financially strapped it may seem difficult to save money, but even starting small can add up over the course of several years. There are financial programs that automatically round up your purchases to the next dollar and put the difference into savings. You probably won’t notice the 55-cent difference between $9.45 and $10.00 for that lunch you bought, but when you multiply that out over several years you will see the savings add up.
4: Earn Some Extra Income
One way you can improve your financial standing today, even without getting a higher paying job or completely eliminating things like shopping and eating out from your budget, is to get a job that allows you to earn some extra income. The extra money you make could pay off debt, be invested in retirement or savings accounts, or even pay for that much-needed vacation you’ve been dreaming about without derailing your other financial plans.
Life Outside the Boss provides people with opportunities to create your own business. You can do it for some extra income in addition to your 9-to-5 job, or you may eventually decide to quit that job entirely because of the freedom and earning potential you will have. Find out more and take steps to secure your financial future by reaching out to us today.
