We all want to be financially stable, but in an economy that’s oftentimes less than stable itself, it’s not always easy. From unexpected medical emergencies to lack of job security, reaching your financial goals can seem out of reach. Being financially stable begins and ends with choices you make each day. And if you’re determined to reach your money goals, you need to put in the work.
Define Your Financial Goals
Before you can reach your financial goals, you need to define them. Some people want to pay off their student loans while others want to have their credit cards paid in full. Think about where you want to be financially in the next year, five years from now, and even 10 years in the future.
Based on your current financial picture, you need to decide how you can make the journey and arrive at your financial destination. Writing out your goals helps you solidify them, make them more concrete and give you an incentive if you feel like things are going in the wrong direction.
Tighten Your Purse Strings
To be financially free, eliminating impulse purchases is only part of the equation. You also need to create a budget you know you can stick to. Aside from housing costs, food and commuting expenses, see where you can cut corners. Most people can identify several areas where they can save money. For instance, lunch out every day probably costs about $10.00. Although it doesn’t seem like a lot, it can add up quickly, especially if you do it five days a week. That money could be put into a savings account that you can use as an emergency fund.
Create an Emergency Fund
Your savings account is not the same as an emergency fund. While some people may consider them one and the same, it’s better to have two separate accounts. Each paycheck, add what you can afford to your emergency fund. A good rule of thumb is to have at least $1,000 in an account you can use in case your car needs to be repaired, you have a medical issue, or need unexpected household repairs.
Free Yourself from Debt
This is the part most of us struggle with. In one form or another, most people have some form of debt. And while having some revolving monthly payments are good for your credit score, feeling like you’re drowning in debt isn’t.
If you’re trying to pay off student debt, along with daily living expenses, taking out a student loan refinance loan could be the solution. You can use a student loan calculator to determine what your repayment terms will be and know how much you can save going forward.
Be Happy with Less
The best way to finally get ahead is to stop falling behind. Simply put, you need to stop living beyond your means and learn to live with less. This doesn’t mean you are never going out or never being able to buy yourself something nice. It does mean you need to be honest with yourself and stop making excuses for overspending. So, how do you make this happen?
It’s easy. You can cook your meals at home, clip coupons and most importantly, become self-disciplined. Give yourself a set amount of spending money and don’t spend more than that. Getting ahead doesn’t mean giving up everything you enjoy.