Upgrade your life: Tips to get ahead financially

Lady holding bag of money and debt February 25, 2018

By Jocelyn Wood, RCB Bank

I challenge you not to accept your financial life as it is. This coming year, aim to get ahead — start an emergency fund, build your retirement savings, pay off your debt or take control of whatever money situation is causing you stress.

The key to getting ahead is to get started. Here are some tips to help you make a financial change.

Invest in you

To build your wealth, start paying yourself first. When you receive money, before you spend a penny, put some of it in your savings account or retirement fund. Set up automatic deposits and watch your savings grow with little effort.

Changing your saving habits may require changing your spending habit, but the payoff – not worrying about paying your bills, taking a trip you’ve been dreaming of and retiring on your terms – is worth it.

Stop throwing money away

Paying late fees is like pulling money out of your wallet and throwing it into the wind. Start paying down debt, beginning with the highest interest debt. Pay your bills on time. If need be, call the company and see if you can adjust your due date. Never hurts to ask and it could save you from paying late fees.

Try the 50/30/20 budget plan

Harvard bankruptcy expert Elizabeth Warren suggests splitting your monthly income into three categories:

  1. Fixed expenses – survival needs – should total no more than 50 percent of your income.
  2. Non-essentials – wants like TV, morning coffee, hair appointments – should total no more than 30 percent.
  3. Savings – emergency fund, retirement – should be 20 percent or more.

Match your spending

Have a hard time sticking to a budget? Try this. Before you spend money on something you want, first put the same amount of money in a savings jar.  You will be able to see exactly how much money you are spending, or how much you could be saving or using to pay off your debt. If you cannot afford to match your spending, you cannot afford whatever it is you want to purchase.

Live within your means

Rich people stay rich by living like they are broke. It is a matter of what you value more, instant gratification or freedom from debt and having money when you really need it.

You work hard for your money. Do not waste it on things you do not really need.

50/30/20 Plan: Elizabeth Warren and Amelia Warren Tyagi. All Your Worth: The Ultimate Lifetime Money Plan. Opinions expressed above are the personal opinions of the author and meant for generic illustration purposes only. RCB Bank, member FDIC.
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Six money tips teens need to know before they leave home

Mother and Daughter holding sign January 22, 2018

Is your child leaving the nest? Do they fully understand the daily financial issues that will soon become their reality? It’s never too early to start the conversation. Here are six money tips to teach your children before they leave home.

1. Know the real cost of things.

The price tag is rarely the actual cost. Talk about hidden fees, taxes and interest. Talk about personal expenses – utilities, car payments, mortgage, and unexpected purchases that can lead to financial trouble if you don’t plan for them, like auto repairs and medical expenses.

2. Learn to budget.  

Building wealth is not about how much money you make, it’s about how you manage the money you have. Money flows out faster than it flows in. Learn to spend less than you earn. Plan for purchases, comparison shop, negotiate terms and fees and save up money before buying things.

3. Be very careful with credit cards.

Talk about the pros and cons of credit cards. One missed credit card payment can set you on a course toward long-term debt. Misuse of credit cards can also hurt your ability to take out a loan for a car or house. Don’t be afraid to share your personal experience with credit card misuse or debt and the sacrifices you had to make to rise above it.

4. Needs and wants are not the same thing.

You will never have enough money to buy everything you want. Choose wisely. Is instant gratification more or less important than a comfortable lifestyle? Today’s choices will affect your future financial well-being. Again, share stories of choices and consequences.

5. Learn the secret to saving.

The easiest way to build wealth is to set up automatic savings. Enroll in payroll direct deposit. Schedule recurring automatic money transfers from checking to savings. Start small and increase with pay raises. If you learn to put money aside and live below your means when you are young, it will be easier to build wealth as you move up the ladder.

6. Consider your future.

Most adults in or nearing retirement wish they had saved more money. Nearly half of Americans have no retirement savings and still have to work when they are 70 and 80 years old. The younger you start saving, the greater control you’ll have over your financial well-being. Talk to your teens about your personal retirement preparations.

However you decide to prep your kids for the real world, be sure money is a topic of conversation.

Opinions expressed above are the personal opinions of the author and meant for generic illustration purposes only. Member FDIC.

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