With the start of the new year, it's safe to assume many individuals have made resolutions and...
Are you ready to start the journey toward financial freedom but are unsure how to get started? Perhaps you are struggling with managing your finances and need help finding a solution. Or, maybe you are doing well with your money management but are seeking a little extra support to get you to where you want to be.
Insert Symple Lending, an innovative financial services company that works hard to deliver sustainable financial solutions to our customers in an effort to help them along the various challenges that life throws at them. We understand that the ultimate goal of our customers is to have financial security and that the journey to get there looks different for everyone.
It is important to know that there are steps you can take to feel more confident with your finances and money management, which we will cover in this post. From staying up-to-date on financial literacy to implementing informed money management strategies, we've got you covered with an array of money management tips to help you on your financial journey.
Understanding Your Financial Situation
The first step to taking control of your finances is having a clear understanding of your current financial situation. In order to take control of your financial future, you need to have an idea of what your current finances look like.
Assessing Your Current Financial State
When was the last time you sat down and took a good look at your finances and how they relate to your lifestyle? If you aren't consistently checking your financial state, you could be doing more damage than good, and you may find that you have gotten off track financially without even realizing it.
When assessing your financial state, be sure to take a look at your monthly income and compare this to your monthly expenses. Try separating your expenses into different categories, such as living expenses and necessities (housing, groceries, etc.), savings, and entertainment. It's important to make sure that the necessities are paid with your income; then, you can decide how much to allocate towards any loans you have and a savings account. As hard as it may be, cutting back on entertainment and unnecessary expenses can help you build your balance and get on track with your financial goals.
Setting Clear Financial Goals
When considering your goals, it's important to think in both the short-term and the long-term. Short-term goals may include eliminating smaller balances, funding a vacation, saving for college, a wedding, or another significant life event, or setting up a savings account. Long-term goals can include saving for retirement, paying off larger balances, saving for a down payment on a home, and more.
When creating these goals, it's important to be realistic and ensure your goals have achievable targets. One of the best ways to make sure your goals are realistic is to go back to your assessment of your finances. With a clear understanding of your financial state and the goals you wish to achieve, you can set yourself up for success when it comes to money management.
Budgeting Basics
Creating a budget can be a daunting task, but when properly executed, your budget will help you better manage money and get you on the right track toward living financially free.
Creating a Sustainable Budget
Budgeting looks different for everyone, and we know that every person has different financial needs. With that in mind, a good place to start when creating a budget is the 50/30/20 rule. The general idea with this budgeting trick is to allocate 50% of your money towards your needs, 30% towards your wants, and 20% towards savings.
If you are new to making a budget, this "rule" could be a good place to start. As you begin implementing your budget and seeing how it works within your needs, adjustments can be made to make your budget more efficient for you.
Sticking to Your Budget
Making your budget is the easy part. Sticking to it can become extremely difficult, especially if you have not been in the practice of budgeting. As you start budgeting, keep track of your spending habits, noticing how much you are spending on wants versus needs and what your income looks like in comparison to the money leaving your accounts.
While it may be difficult at first, by sticking to the budget you set, you can quickly see your savings start to build, and your financial goals become more achievable.
Smart Saving Strategies
If you want to start saving but aren't sure where to begin, we've got a few tips and tricks to help you get started. A great way to motivate yourself to save money is to understand exactly what it is you are saving for, whether that's having an emergency fund so you don't have to stress when life throws you a curveball or setting money aside to achieve a specific goal, having an idea of what you are saving for can be extremely helpful.
Building an Emergency Fund
While in an ideal world, you would always have funds available for unexpected emergencies and be able to anticipate the curveballs life has to throw at you, that's not the reality we live in. Sometimes, life happens, and you suddenly have an unexpected expense that you need to cover. Whether it's a medical bill, home improvement, car repair, sudden loss of income, or some other large expense that you suddenly need to cover, having an emergency fund established can be a huge help in these situations.
When you have an emergency fund that you can dip into for these unexpected costs, the financial burden can seem less significant and have less impact on your financial goals. But how much should you aim to save?
A general rule of thumb is to save at least three to six months of expenses in your emergency savings at all times. Your emergency fund's exact size will vary and depend on your lifestyle, monthly costs, dependents, and more. As you work to build your emergency fund, you can contribute a set amount each month based on your current financial obligations and adjust your contributions as needed.
Saving for Future Goals
Emergencies are not the only reason you should be working on building your savings. Are you planning on taking a big trip in the future, considering purchasing a new vehicle, wanting to purchase a home, or perhaps having a big life event (such as a wedding) coming up? While these are not the only reasons you should consider saving money, they are just a few examples of events that could encourage you to start saving.
When you have an established goal, you may find it easier to motivate yourself to save. Like your emergency fund, when you have a future goal that you are saving for, you can allocate a set amount of money aside each month to put toward this goal, so when the time comes for your big vacation, vehicle purchase, home downpayment, or other event, you already have the funds ready to go.
Making Informed Financial Decisions
When deciding on the best ways to manage your money, one of the best things you can do is make informed financial decisions that best align with your goals. But how exactly can you ensure you are making the most informed choices for your financial needs?
The Importance of Financial Literacy
Staying financially literate is one of the best ways to make sure you understand your financial situation and can set the best course of action to reach your goals. By remaining financially literate, you will be able to use better use your financial skills and knowledge to make the most informed decisions regarding money management.
Focusing on financial literacy will help you understand how to earn money through different revenue streams (employment, investments, etc.), create and stick to a budget by tracking your income and expenses, understand your credit score, build wealth through investments, and overall have a better grasp on your own finances.
Understanding financial literacy is something that you should be working on continuously, as there is always going to be more that you can learn in order to understand the impact of your finances and how to better manage your money.
Planning for the Future
When assessing your financial situation, it's important to not only ensure you are financially secure in the present but also to make sure that you are setting yourself up for financial success in the future. Whether you are looking toward retirement or preparing for a major life milestone, make sure you are prepared by managing your money properly.
Planning for Retirement
No one wants to work forever, so it's important to start saving for retirement early. By investing in your retirement account early on, you can allow compound interest to accumulate quicker, reducing the amount you'll need to save later on. That's because compound interest is interest that applies to the initial principal of your retirement investment as well as the accumulated interest from previous periods. In other words, with compound interest, you are earning interest on your interest.
When it comes to retirement plans, there are many different options available. From 401(k)s to IRAs to HSAs and more, it's important to find the best retirement plan for you. For many, their retirement plan is determined based on what is offered by their employer. If you decide to take advantage of your employer's retirement plan, make a note of whether they match contributions and ensure you take advantage of this opportunity.
Preparing for Life's Milestones
Retirement isn't the only future event you should anticipate saving for. As we all know, life is full of different milestones, which each come with their own financial needs. From buying a home to pursuing your education, these major life events require strategic financial planning.
As you move through life and your plan changes, so too should your financial plan. While you may have an idea of what your timeline for different milestones should look like, be prepared to make changes and adjustments as needed.
Leveraging Symple Lending's Resources
At Symple Lending, we understand the importance of creating a solid financial plan in order to achieve your life goals. We also understand that sometimes life can get in the way, and unexpected challenges may arise. When this happens, we are here to help.
Personal Loans
A personal loan allows you to borrow the exact amount of funds required for your needs, with a fixed interest rate and set repayment schedule. While you do have to pay your personal loans back (no, they are not free money), the terms of your loan should be clearly defined with a realistic repayment plan. Additionally, you are often able to pay back personal loans early with no penalties, although you should check your specific loan terms to be sure.
At Symple Lending, we help our customers find the best personal loan options available in order to make their dreams a reality and start the journey toward financial freedom. If you are interested in learning more about our personal loans, you can do so on our website.
Conclusion
By now, you should have at least a handful of helpful money management tips that will allow you to start the journey toward financial freedom and more efficiently manage your finances. Money management can be a daunting task, but it's important to remember to start small and remain focused on the end goal: financial freedom!
By taking action and working towards a better understanding of money management, you can set yourself up for success in the financial landscape. Whether you have a specific goal in mind or are simply trying to build upon your savings, now is the time to start your financial journey.
Symple Lending is here to offer a helping hand in the form of personal loans, and our agents work hard to find the right financial solutions for all of our customers. Our overall goal is to help our customers start the journey toward financial freedom and start living the lives they have always dreamed of.
Start Your Financial Journey with Symple Lending
If you are interested in applying for a loan with Symple Lending, the process is simple!
To apply, head to our online form and complete your information. Once your application has been submitted, our agents will take the time to review your loan options and find the best loan terms available to you. After your approval* you can see funds in your account in as soon as 48 hours!
*Loan approval is not guaranteed and is dependent on a variety of qualifying factors unique to each individual applicant.
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.
