As responsible adults, we shouldn’t just be living life for today. We need to be planning for the future, and setting ourselves up financially is a huge part of that. Money might not be everything in life, but it is important. We need money to eat, to keep a roof over our head, to be able to do the things we enjoy and to give us and our family stability.
When you’re financially secure, you can deal with whatever life throws at you without money being an additional stress. Here are just a few of the things you can be doing today, to secure a brighter financial future.
Get out of debt
Debt is expensive. When you owe money to a creditor, not only are you paying back what you borrowed but each month you’re paying interest on that too. Whether it’s loans, credit cards, store cards, catalogs, or a mixture, you could be paying hundreds every month just on interest.
This is a lot of money to be spending on essentially nothing, and so getting out of debt is one of the best things you can do for yourself financially. Perhaps you could sell items to raise money to pay down debt, or maybe you could cut back on all luxuries for a while and take on some extra shifts at work to get things paid off more quickly. If you have good credit, one option would be to take out a consolidation loan or credit card.
Use this amount to pay off your other debts, and then close those accounts completely. Consolidation loans and cards usually have no interest for a set period, giving you time to pay off as much as you can without it being sucked up by the interest. On top of this, the amount of interest when you do start to pay should be lower meaning it works out cheaper for you to pay back.
You’re also only paying one amount every month instead of lots of different companies. So, it makes it easier to stay in control and to know exactly how much you have left to pay.
It makes no sense to have savings while you have debts because debts are costing you money with their interest. It actually makes more sense to pay down any debts you have with savings to get them out of the way as quickly as possible. Once you’re debt-free, now is the time to start saving.
You should always have an emergency account, one that’s never touched unless it’s a genuine emergency and you need cash fast. Then more of general savings account that you can use to save up for things you want to buy, special occasions or for less extreme emergencies where having the cash on hand will make life a lot easier.
Work out your budget and decide what amount each month you will be putting into each savings account. Just a little each month will soon add up and you’ll hardly notice it, but it can make a massive difference if a situation crops up and you need the money.
Learn to budget
Speaking of budget, this is one of the most important skills to learn during your adult life. Whether you have a little money or a lot, knowing how to manage your incoming and outgoing money is extremely important. It allows you to live within your means, prevents you from falling behind and needing to rely on credit which can cause debt.
It means you’re not accumulating missed payments and ruining your credit score- it generally just keeps you in control. Work out exactly what comes in each month and what goes out. Find the best deal on things like utilities, and find ways to cut down food costs to save you money. You could use a budgeting app, software or just a pen and paper to track your money. Work out a system that suits you and be sure to use it each month so you know where you’re at financially.
Earn more money
As well as managing the money you already have correctly, one way to make your life easier is to actually earn more. If you’re already on the path to the career that you want, work hard to achieve the promotions you need to eventually get to where you want to be. If you’re not happy where you are or you’re stuck in a dead end career, consider a change.
You could study and get qualified before leaving the job you’re in- University of Redlands online programs, for example, give you lots of options for courses that you can do part-time from home. Once you’re qualified, you can then begin to apply for work in the area you want without having to take years out or risk being out of work for months. Another option for earning more money is to start a side hustle.
A blog, a home business or freelancing work all allow you to earn cash from the comfort of your home and in a way that’s fun and enjoyable. If you choose something based on your skills and interests you can earn money without it really even feeling like work.
Buy a home
One of the most expensive elements of most of our budgets is paying for the place that we live in. Whether you rent or you pay a mortgage, this price usually won’t be too much different. However, when you’re paying a mortgage you, of course, have something to show for it.
Saving for a home deposit can be difficult, however, if you can do so and secure that mortgage you put yourself in the best position later on. In the future, you will own a home, whereas when you rent that money goes to a landlord never to be seen again. Do what you can to get yourself onto the property ladder, it’s one of the best things you can do for your financial future.