I got my first job when I was fifteen. More so, I began paying taxes when I turned fifteen. Before that I would run the many small side businesses my parents set up – selling corn in the summer, pumpkins in the fall, Christmas trees in December, and for a couple years I would sell flowers in the spring when we had the greenhouse. My parents are industrious people. I started going to private school when I was 16, and the deal was that they would pay for tuition and I paid for everything else. Believe it or not, working part time as a pharmaceutical clerk between volleyball practices, play rehearsals, school senate, and writing for the yearbook and school newspaper didn’t pay for a whole lot. I learned very early on how to make life work on a tight budget. I moved to New York City when I was seventeen to pursue theater and film. I had to learn how to stretch $20 a week for groceries – with no kitchen. My first apartment had no doors except the front one and the electricity only worked in half the place, half of the time. There was a brief time I lived in the woods for about 3 weeks. I lived out of my car for about a month in my mid twenties. My point is I know how to live without and money had never really been a priority.
This is the first time in my life that I have money. Don’t get me wrong I’m not a financially wealthy woman, but I have more than enough, and much more than I’m used to. Things I’ve noticed – I don’t wake up in the middle of the night worried about having enough or about the future. Saving money used to scare me because there just never seemed enough to stretch to just set aside. It’s become apparent that from mindset of scarcity , wealth seems impossible to accumulate when in reality it’s all about time and proportion. Here are some tips I’ve picked up – (Disclaimer – I am not a financial guru of any means or education – these are just things that have worked for me personally.)
1. BUDGET LIKE WHOA – This is an obvious one, most people know how to budget. I used to budget paycheck to paycheck – which would just leave my resources depleted each pay cycle because there wasn’t any margin for long term spending. I sat down and did an annual budget instead, as well as a monthly budget. I even have a budget set up for any and all excess so that particular revenue is also utilized.
2. MULTIPLE SOURCES OF INCOME – Even if it’s just an extra 10 hours a week in retail or babysitting – it’s important to budget your money, but also to budget your time and productivity. It’s also nice not to have to wait for a single payday to get an influx of cash.
3. SAVINGS – Set aside a set amount in your budget strictly for savings as if it were a bill. I automatically have it set up with my bank that a portion of my pay is directly deposited into a savings account. You never have to worry about how much to save or not save if you never see it. It’s also good to have multiple savings accounts for different purposes. One or more savings accounts for something that you are saving up for specifically so when it’s time to spend money on that particular purpose you aren’t left short on your budget for that time – but alongside just a general savings account. The more money in your savings account, the more interest is earned on that account. You’ve heard it and it’s true, the rich get richer.
4. CHECKING – Having multiple checking accounts has been proven handy as well. I have one checking account specifically for bills and one for everything else. Having a checking account specifically for bills helps me budget out the exact amount I need for my monthly expenses in the account. All my bills are enrolled in auto- pay which also saves me money.
5. CREDIT – There are so many apps and sites now where you can check your credit score for free. Having a high credit score makes it possible and easier if a big financial burden comes along such as buying a house, opening up a business, paying for education, or purchasing a new car – and applying for a credit card. Credit cards are a great tool to improve one’s credit score. They are also handy if a big, unexpected expense does come your way – you can use the credit score and pay it back in installments instead of blowing your budget. They are great for emergencies as well. However, be careful not to spend money you don’t have otherwise credit cards go from being a great tool – to a catalyst into debt and an anchor holding you down. There are so many cards with reward systems now too where you can get rewards including cash for making everyday purchases. I like to use one of mine just to do everyday purchases instead of cash just so I can make money on something I was going to buy anyways – but then set the cash aside in an envelope.
6. TRACK YOUR SPENDING – So along with budgeting, it’s important to track how much and how often you are spending money on certain things. There are also apps that will track your spending for you if you aren’t real keen on sorting through a shoe box full of receipts. ( I highly recommend Intuit Mint) About every two months I go through my spending to see where I can save myself some money and alot of this comes down to priorities. Just because you can afford something doesn’t mean you necessarily should. An easy example is entertainment. I watch far less TV in the summer so instead of paying for cable, Netflix, Hulu, and Prime Video I’ll narrow it down to just Netflix until the weather starts to get colder out. There are also certain things I’m willing to spend more money on for brand name than others. For me, I buy a specific brand of toilet paper. When I first moved out and times were rough there were times when I had to choose between toilet paper or food, (I chose toilet paper FYI), but still had to buy really cheap stuff that was rough and dissolved fast. So for me, having the “fancy” toilet paper as silly as it sounds, feels like security. So although I am particular about toilet paper, I’m willing to get the cheaper brand of some cleaning products. It’s also about quantity verse quality as well. If you need a pair of shoes it’s actually more practical in the long run to pay $100 annually on a quality pair than $40 quarterly on a cheaper pair that wears out more easily. This is also why an annual budget is needed as well as a monthly.
7. KEEP AN EYE ON THINGS – With so many automated services now it’s easy to just kind of co-pilot through your finances. It’s important to check in regularly with all your accounts to make sure a subscription price didn’t increase, that sudden hidden fees haven’t been applied, and to be on the lookout for theft and fraudulent purchases. This keeps your budget on the mark , because even small discrepancies make a big difference overtime.
8. TAX RETURNS – If you get tax returns , add it into your monthly budget and spend accordingly. Try not and depend on tax returns for any big financial move because the amount returned really isn’t a guarantee.
9. INVESTING – Like I said before, I am not a financial guru or even math whiz, (far from it!) So if I had to sit down and actively take action on the stock market – the IRS would own my soul as we speak. Technology really is such a great tool for everyday people to accumulate wealth. There are also plenty of apps and sites so anyone can start investing. But also because there are so many available apps and sites it’s important to research and find which ones are good fit for you. Personally, I use Acorns, Stash, and Ellevest.
10. RETIREMENT – Retirement is something that is easy to not plan for when you’re still in the early stages of your career. I didn’t really consider or think long term for my financial future until I had discussions with my parents who are getting ready to retire soon. This also opened up discussions with those whom I know are near the average retirement age but were never able, or did set anything aside and now cannot retire or have to be dependent on the state when they can no longer physically work. If your job doesn’t offer a 401(k) or similar retirement savings, you should set up your own. This is right up there with investing – invest in your future! Don’t leave your future up to chance. Not to mention the way social security is set up right now, there’s not going to be much left of anything come 2050 (thanks baby boomers….)
11. MEAL PLAN – Not only is this physically healthy to do, but also financially healthy as well. If you take the time to plan your meals and to grocery shop it helps you to set a more secure budget on the amount of money you’re spending on food. If you’re anything like me, if you are rushed or don’t have time (or the will power) to go grocery shopping and plan meals you’ll just end up eating out or getting something last minute (regardless of sales, coupons, best deals etc.) This not only more often than not creates food waste, (and waste money when a product is not being utilized.) , but costs more in the long run. When you eat out, part of what you pay for is the experience, atmosphere, and service. I could go to a restaurant and get a decent salad for $15, or spend $20 on salad ingredients and make 3 meals out of it.
12. BE GENEROUS – Now I’m not sure if I can actually count this as a tip to improve finances but I definitely recommend giving and generosity as something to consider when looking at one’s financial health. Most of us go through both famine and feast, and what a beautiful place this world would be if there was as continual communion of giving in excess and accepting in need. The only thing we have control over are our own actions, so decide for yourself. This can also be set aside in a budget, I like to set aside from my annual to be able to give more to something/someone I believe in and would like to see grow. Giving helps me from becoming too attached to money and to continue using it as a tool and not as the goal. Giving and generosity also has emotional and mental benefits that hoarding money cannot obtain.
Have any money tips? What are some of your favorite financial apps? Leave in the comments below!