Budgeting 101: 4 Simple Money Management Tips

When it comes to money management, it becomes difficult if you don’t have any financial literacy and don’t know anything about topics such as debt reduction or responsible credit use. However, with the right financial tips, you can easily learn how to do things like start building emergency funds in no time. While it does take some work and patience, having the right tips in mind will get you started down the right path. Keep reading this article to learn about four tips that’ll make money management much simpler.

Use These 4 Financial Tips Right Now

1. Create A Realistic Budget

The first thing you’ll need to do when it comes to proper money management is to create a realistic budget. Creating a budget is important because it will keep you organized and accountable for how you spend your money, so it is important that your budget is something you can stick with. This means you need to know what your expenses are and how much money you have coming in on a regular basis. From there, you will be able to create categories so you can split up your money appropriately.

And with so many apps out there for you, there’s no reason you’d have to make your budget on your own. Budgets are about using and organizing information, and that’s something an app can help you do quickly and easily. Plus there are a bunch of budgeting apps you can choose from that can help you out. You can use an app like Goodbudget to help you use the envelope system, PocketGuard to track your spending, or Honeydue if you are new to budgeting with your live-in significant other.

2. Set SMART Goals

In order to improve your financial literacy, you have to set some financial goals for yourself. These goals will keep you motivated to keep going and will make sure you keep yourself accountable. The thing to remember about setting goals however, is that you make sure they are goals you can actually meet. If you set unrealistic goals for yourself, you’ll only end up disappointed and lose all motivation. Instead, make sure your goals are SMART goals, or:

• Specific: Instead of making your goal too broad, limit it to one specific area you can tackle at a time. This could be something like saving for a down payment on a house.
• Measurable: Give yourself a specific metric with which you can measure your goal. This could be a specific amount of money or a specific time frame of when you want to achieve your goal.
• Attainable: Again, make sure your goal is something you can actually realistically meet. Whether that is a long-term goal or short-term, make sure it is realistic.
• Relevant: Make sure your goal is actually going to assist in you actually improving your money management. If it has nothing to do with bettering your finances, it shouldn’t be in your financial plan.
• Time-bound: Make sure your goal has a due date that you will complete it. This will help you create a nice pace so that you can take steps to completing your goal on time.

3. Work On Managing Debt

The next thing you need to do if you want to increase your financial literacy is work on managing your debt. Debt reduction is important if you want a chance at stabilizing your finances. This means you need to find a way to handle your debt at a steady pace. Two common methods are either the snowball method or the avalanche method of paying off debt. The snowball method means you pay off your smallest debt and work your way up. The avalanche method is the opposite, where you pay off the largest debt.

You’ll also have to practice responsible credit use to manage your debt. This means keeping your credit utilization low so you don’t bury yourself in unnecessary debt. Even if you happen to have a large credit limit, you don’t have to use the full limit. Instead, you should aim to only use around 30% of your credit limit each month. And when you do use your credit cards, be sure to pay the bill in full and on time. Lastly, make sure you only use your credit cards for important reasons.

4. Build An Emergency Fund

Lastly, if you want to increase financial literacy and improve money management, it is very important you begin building an emergency fund. Having an emergency fund set up is important to protect your finances in any way you can. And even if you don’t have a lot, it is important that you set something aside. Remember, even putting a small amount in your emergency fund whenever you can will build up eventually. Make sure your emergency fund is somewhere you can’t access all the time too easily.

What Can You Do If An Emergency Gets In Your Way?

While getting your emergency fund built is very important, that doesn’t mean an emergency can’t hit before you are ready. If you find yourself hit with an unexpected emergency, then getting auto title loans from us at Texas Car Title and Payday Loan Services, Inc. could be a good option to get you the quick money you need. If you have a lien-free title to a paid-off vehicle in your name, you can use the title as collateral. We will assess your driver’s license and title, and inspect your vehicle to see how much you can get.

Start Managing Your Money The Correct Way Now

If you are wanting to increase your financial literacy so you can manage your money better, these tips can help get you started. You can follow just one or all four, but either way they will help you with your money management and debt reduction. And if an emergency does hit you before your finances are able to handle it, we here at Texas Car Title and Payday Loan Services, Inc. can help you get auto title loans. Fill out the online application on our website to learn more about the loan and to begin the process.

 

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.