ExecutiveChronicles.com | Did you know that most US citizens are just one $500 emergency bill away from becoming broke? According to the latest studies, 62 percent of American adults could become homeless, without a roof over their head if they did not receive a month’s paycheck. Now, only 58 percent of the same group could afford to pay for an unforeseen bill provided they manage to cut back on other expenses. They could pay at the most $500 using their credit card, borrowing money from a lending agency or a friend or family member. According to an article published on https://www.entrepreneur.com, people flinch when it comes to saving. However, there are many ways to do so. Look at your daily spending habits, and you will know how to save every day. For example, if you shell out $6 on café latte in a coffee shop daily, you can reduce such expenses by having a latte every alternate day. This way, you will be habituated, and your savings will increase over time. To build your saving habit, you will need to take a closer look at your financial condition and change your lifestyle accordingly. It is not necessary to make radical changes as you may think. Even considering a few aspects will help you grow your savings and manage debts easily. Here are five tips to improve your finances.
- Keep a Control over Your Spending
Start making choices when it comes to your daily spending habits. For example, you are a movie and TV series buff and spend much of your hard-earned money buying DVDs costing you heavily every month. It is not a wise decision when it comes to your money management. You can subscribe to video streaming services like Netflix or Amazon Prime to watch your favorite TV shows and movies. You only need to pay a nominal annual subscription fee that is much cheaper than paying for individual DVDs. If you have debts to pay off, you can consider purging this expense for a while. Again, if you have the habit of visiting pubs and drinking beer every weekend, try cutting back on such expenses. You can use the saved amount to pay off your monthly electricity bills instead. If you are having a tough time paying your bills on time or growing your savings, you will need to make a few difficult choices. You can always improve your lifestyle once your finances improve.
- Negotiate with Creditors
Many people believe that their loan repayment terms and rates of interest are rigid. Wrong! These things are not always set in stone. You can get in touch with your creditors or lenders to renegotiate the payment terms. You will need to make an effort to pick up the phone and make a call. You will not get what you want unless you ask for it. Sometimes, this strategy may not work, but at other times, it will work.
Usually, creditors love to work with customers who make their payments on time. However, they only request for a temporary change in their repayment terms so that they can continue to pay within the due date most of the times. Many lending agencies offer consolidation loans on flexible terms. You can check the debt consolidation reviews of these companies and pick the one that offers the best payment rates. Take some time out of your busy schedule and choose the one that best suits your financial needs. It will help you make an informed decision.
- Create a Budge
Based on the findings of a Gallup survey, 68 percent of US citizens fail to create a detailed budget to manage their finances in a better way. It is one of the greatest blunders to make because, in the absence of a budget, it will not help you control your finances. Instead of spending extravagantly with no clue as to how to manage your expenses later, you need to sit and create a proper monthly budget. This way, you will get a clear idea of your expenses and income. Include every detail from minor to major expenses in your budget. It will help you understand how you are using your money. Are you spending your cash for valid reasons? The budget will make it simple for you to eliminate unwanted expenses. A precise budget will let you avoid impulse purchases that you do not need at all.
- Use Your Investments Smartly
It is true that high-return investments come with certain risks. Then, you need to take some risk to improve your finances. Learn to use your high-return investments wisely for a better outcome. You should know how to use them to your benefit. If you are young, you can invest in some mutual funds. Even if the returns are low, you will have more time to recover from the losses since you have started investing at an early age. Ensure that you do not use all your savings into high-yields investments. Try to use to 10-15 percent of your savings to invest in such high-return investments. Try to research on mutual fund schemes that have a solid return history. If you are knowledgeable about these matters, you could cash out a considerably heavy amount that you can use to your advantage. You could start saving the amount and build it over the years to invest further.
- Keep an Eye on Your Bills
Look at your monthly bills and check them regularly. You may be paying the minimum amount on your credit card bill every month without checking for the erroneous entries. Take a closer look at the rates of interest and check whether they are correct or not. If not, inform the credit card company and ask them to rectify those errors. Auditing your monthly bills will ensure that you are making the right payment. And it is not based on the flawed entries that increase your expenses. A bill audit will let you figure out how much you could save in the future by adding at least $10 to every credit-based payment.
Now that you know how to take control of your finances, start saving now. Cut back on unnecessary expenses and dig out of your debts on time.