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The word money can cross many different subjects to your mind. It may sound as a key to freedom, a happy life, a jet just for observing every corner of the world or a great career and education. One thing is similar in all these subjects, is seeing money as a tool, it’s not a goal itself, it’s the reason.
Money as a result of being a reason, should be expected to fly away. So, don’t ever try to hold it dear, let it go. We don’t mean to burn all your money out, what is trying to be said is not to store money. Set it free and do invest. Turn it to a passive income. Money brings money. See money as an employee working for you.
Here we are going to provide you some finance tips that may help you to use money in the way it meant to be used.
1. Create a calendar
The foundation of reaching financial freedom is managing your money.
Budgeting apps such as Quicken or Mint are the ways to manage your money correctly. If you don’t rather to use software apps, then just create a calendar. Trust us when we say, living in the most desirable life you always wanted (which path requires a huge amount of money), is unachievable unless you well understand how to handle your financial problems.
Write down every debt you owe with their deadlines, every single penny you spend, every income you earn and whatever relating to money, in the calendar. As it is laborious, we recommend you to use software apps which mentioned in “TOP 10 OF BUDGETING SOFTWARE APPS”.
2. Calculate your net worth
The difference between assets and liabilities is called net worth. Net worth being positive a good sign and it enlightens the stage you are standing on. For further information about financial stages read “A JOURNEY TO FINANCIAL ABUNDANCE”.
3. Wipe out all your debts
Debts are an anchor holding tight to you to drag you down where you were before. However hard you try, while having the habit of going under a debt, you can never consider yourself as a successful person in finances.
Not just is getting rid of all your loans and debt wise, but also throwing away your credit cards is.
Once you are free of all your debts, make sure you won’t ever fall into its trap again. Creating an emergency fund will do the trick.
4. Be active in using your credit card
Take a report of your credit card every single time. Some may abuse their knowledge and start stealing from your credit card.
Never spend the money you don’t have. It’s a trick just to bury you under a pile of debts. Remember this rule and keep following it. In the end you find yourself paying more than money you should just because some boring debts.
5. Be minimalist
Avoid eye-catching colors and patterns. Don’t get tricked by the updates always keep coming. Just spend on things you need, and by need, we don’t mean just the essentials of a minimum life, we mean the things that bring real value to your life.
6. Start saving
As it mentioned before, in order to not bury under a pile of debt again, creating an emergency fund is essential. It is recommended to get ready for a rainy day and put aside a noticeable amount of cash aside. Put the rest of your money in a saving account. Due to the rules of interest rates, it is better to keep all your money in one trustworthy account.
If you are desperate for raising your money and you decided to invest all you have, we advise you not to do it. Taking risks requires attention, putting your money in a saving account is an absolute passive income. Although, its interest rates are not as much as an investment, gradually it will be. Once the amount in your saving account guarantees you a suitable life, start risking. There is one rule saying the greater your amount of money is, more risk can be taken.
7. Learn not to spend fast
There are some rules bordering the amount of money you should pay. U.S. Senator Elizabeth Warren’s 50/30/20 rule is the most used one. According to this rule, you should put
50 percent of your income on needs, like insurance, the house you live in and all your essentials such as groceries;
30 percent on wants such as the clothes you buy or an update you perform;
20 percent on savings that shouldn’t even consider to be touched.
The numbers above could be changed enormously. So, don’t keep on its track. Huge expenses may happen that can have a huge impact on your life. Brace for the damage they are going to make. Create an additional saving account just for these huge expenses.
Wherever you could, reduce the amount you spend, albeit don’t get hard on yourself. According to Suze Orman “Look everywhere you can to cut a little bit from your expenses. It will all add up to a meaningful sum.”
8. Increase your income
One of the best ways to have a raise in your income, is investing. $10 earned by an active job is equal to $1 earned by passive job. Although It sounds bizarre, this is the result of the time you’re saving. As you know time is precious.
Don’t aim high in investing unless you are certain that the money you put at risk, doesn’t affect your life at all.
Renting properties is another way to build wealth. Every rule said about investing is also true about rental properties.
If you still stuck with debts or you have an amazing interest and irony will to earn money, and fell in love with your main job and you don’t want to search for a higher-paying job, searching for another source of income will be obvious. Writing a blog, doing researches, working as a freelancer are some of the jobs worth looking.
9. Don’t forget about insurance
It was necessary to remind you of this step. Insurance doesn’t count as a feature, it’s the essential of life. Its value is far from imagination. Of course, you are paying an amount which may have no use to you, it’s a probability, though. 0.5 percent chance is a critical situation when it comes to pandemics like earthquake. So, the first you do while having money, is jumping right towards the insurance waiting for you.
10. Always negotiate
The world out there is a tricky world. Be hundred percent certain that every price you hear is far away from what it meant to be. The reason is wanting to give a discount. The seller never loss a penny during selling a single product, so negotiate as clever as you can. You must be the one who puts price on a product, to do so, gain intelligence.
If you want to apply for a job, keep the same thought as a customer you were before. The price they propose to you is at least 10 percent lower they predicted before. So, don’t worry and negotiate easily.
11. Avoid lifestyle creep
The higher your income gets, the higher you want to spend. It’s a trap everybody falls in. Maintain the balance of your wealth, keep your net worth as high as you can, if not you will face an unpleasant downfall. Keep being minimalist, even when you are considered as a billionaire. Why do we spend on things bringing no value to our life?
12. Read about cryptocurrency
Today, cryptocurrencies have become very profitable.It is very useful to read a little about cryptocurrencies.You can read the required information about the cryptocurrency market on our site.