With the start of the new year, it's safe to assume many individuals have made resolutions and...
What are your long-term financial goals? How important is it that you are financially well-off in life? Are you making the right financial choices now to ensure you are set up for success in the future?
If your answers made you unsure of your financial future, don't panic! No matter where you are, it's not too late to start working on your smart money habits to set yourself up for success. By starting now, you can develop healthy financial habits that will positively impact your future. You can start small now for a BIG impact later!
1. Daily Money Check-Ins
Developing a daily habit of reviewing your finances can help you stay aware of your spending and saving patterns. Completing these checks every day may seem overkill, but looking at your finances at the beginning or end of each day can prevent overspending and eliminate unnecessary costs.
How to Create This Habit
One of the best ways to get in the habit of checking your finances is to do so at the same time each day, such as during breakfast or before you go to bed. Creating an alarm to remind yourself can also be helpful.
To keep track of your finances easier, consider downloading a budgeting app to make tracking your expenses and income more efficient. The most important thing is to find a routine that works best for you!
2. Automate Your Savings
A great method to achieve financial success is establishing a savings account, and automating your savings simplifies this process by ensuring that you consistently set money aside without even having to think about it.
Start Small
Even small, consistent contributions can add up over time, so it’s okay to start with what fits within your budget. Remember that small, automatic contributions will add up over time; soon enough, you will have a strong financial foundation.
Implementing Automated Savings
When building your savings account, you can thrive from a "set it and forget it" strategy. Instead of manually adding a portion of your monthly income to your savings, automatic transfers move a set portion of your paycheck into your savings each payday.
You can also take advantage of round-up savings programs, which round up your purchases to the nearest dollar and deposit the 'spare change' into your savings account.
It's important to remember to contribute what you can to savings while still living within the rest of your budget. Over time, the amount you contribute may fluctuate, but each contribution, no matter the size, is a step in the right direction toward your best financial future.
3. Practice Mindful Spending
One key aspect of creating healthy financial habits and practicing mindful spending is distinguishing between "needs" and "wants." By thinking about your purchases, you will recognize which purchases are worth your money and which ones you might skip.
Want vs. Need
You can live without purchasing a "want," like a new phone, concert tickets, travel, etc.
A "need" is essential for survival and basic functioning, like food, shelter, and other living expenses.
Strategies to Cut Unnecessary Expenses
If you are struggling with impulse purchases, consider the 24-hour rule, where you wait 24 hours before making non-essential purchases, giving you time to decide whether the purchase is worth it.
Mindful spending can help you become more conscious of your spending habits and help pave the way toward a brighter financial future.
4. Set and Review Financial Goals Regularly
One of the best ways to improve financial habits is to have clear, achievable financial goals for yourself that you can easily track and manage. Setting clear goals can help give you direction and motivation to stick to your healthy money habits. Examples of actionable financial goals include, but are not limited to:
- Saving for a down payment on a home
- Planning and booking a vacation
- Building an emergency savings fund
- Saving for retirement
How to Stay on Track with Your Goals
Once you have your big goals in mind, you can create smaller, actionable steps with deadlines to help you stay on track. If you miss a deadline here and there, remember not to put too much pressure on yourself—life happens, and timelines can be adjusted if needed.
As you work toward your goals, schedule regular check-ins for yourself to review your progress and make any necessary adjustments. These check-ins can be weekly, monthly, or any other frequency – finding a schedule that works for you is important!
5. Reduce Financial Stress with Budgeting and Planning
Creating a budget can provide clarity on where your money is being spent and may help reduce unexpected financial stress. By planning out your finances (whether that be daily, weekly, or monthly), you can better align your spending to set yourself up for success when it comes to your financial goals and priorities.
Easy Ways to Start Budgeting
There are many different budgeting methods, so the best way to start is to choose a method that best suits your lifestyle. Common methods include the 50/30/20 rule or the envelope system, but there are many others that you can choose from and/or adapt to fit your needs.
Additionally, you can always use a budgeting app or spreadsheet to easily track your spending and stay on top of your budget.
Developing Healthy Money Habits Can Set You Up For Success
While the tips outlined in this post are not the only ways to help improve your financial future, they are a great way to get started on your journey toward financial freedom. Remember that even the smallest actions can lead to significant improvements in the long run as long as you remain consistent.
If you are ready to start your financial journey, consider trying out one or two of these habits to start and adding more into your routine as time goes on. Soon enough, you will be well on your way to the financial future you dream of!
Disclaimer: The information provided in this blog post is for educational and informational purposes only and should not be considered as financial, legal, investment, or tax advice. Symple Lending is not responsible for any financial outcomes resulting from following the information or ideas shared in this blog. Every individual's financial situation is unique, and we strongly encourage readers to take their own circumstances into consideration and consult with a qualified financial, legal, tax, and investment advisor before making any financial decisions. Symple Lending does not provide financial, legal, tax, or investment advice.
