10 great strategies on how to instantly improve your personal finance

1. Know your current financial situation.

Before you can make any plans to save for any activity, be it for your children’s education, your retirement, or the purchase of that dream home, you need to know your financial situation today. You may need to take the trouble to get a financial planner if you don’t know how to create a financial plan. If you know how to create a financial plan, you can save a decent amount of money when using a financial planner.

2. Save regularly.

Getting into the habit of saving is a good virtue. You never know when you’re in desperate need of that extra cash when unexpected events happen like a cut in expenses or a loved one gets sick that requires a lot of medical attention that incurs huge medical costs. As a guide, it is necessary that you set aside 3-6 months of your current salary for emergency needs.

3. Control your cash flow.

No matter how rich you are, you should be able to control your cash flow. The simple rule is that there should be more of what goes into your pocket than what comes out of your pocket. You need to be aware of what gives you income and what makes you spend.

4. Reduce your expenses

Start by tracking your daily, weekly, and then monthly expenses. Find those expenses that are not necessary and eliminate them. A good example of this is paying for subscriptions to magazines you don’t read. When you identify all of these items that aren’t worth your dollars, you can dramatically reduce your expenses by 25-30%. It is recommended that you have only one credit card so that you can better keep track of your expenses. Make sure you pay the full amount by the due date of each credit card bill before you spiral into incredible debt.

5. Review your debts

As a general rule, your debt tolerance should not exceed 30-35% of your total income. Gambling and vices are good candidates that can lead you into debt. Mismanagement of money can also lead to debt even if you won two million in the lottery or inherited a large fortune from a relative.

6. Be frugal, but not stingy

Only buy merchandise when it gives you good value for your money. It is wise to know when to buy something of high quality and to pay a premium for something less known but still serving the same purpose as a branded item. If you will always choose items based on cheap prices, that item may fail in a short time which will lead to buying another item, this will lead to more expense than you originally expected. You will also be labeled as a stingy person, not willing to spend money when it is absolutely necessary.

7. Review your investment portfolio

If you have invested in stocks, mutual funds (mutual funds), or various funds, you will want to review them on a regular basis. The review period can be quarterly, semi-annually or annually. For example, when you do your quarterly analysis and you find that the stock of the company you invested in is not giving the target returns based on financial numbers or outside interference, you want to replace that stock with the stock of a better performing company.

8. Educate yourself financially

There is a wealth of financial information out there and it’s free when you browse the Internet or go to your neighborhood library. Attending seminars, reading books, reading newspapers and listening to audio tapes are some of the ways you can gain more knowledge.

9. Be generous

There is a famous saying “You get what you give”. When you are generous, some how spiritual forces know this and reward you many times over. When you give, there is a natural tendency in the other person receiving the giving to want to return the favor to you.

10. Pay yourself first

Before you pay all of your monthly expenses, you should develop the habit of paying yourself first. If you have a day job, when it comes to the daily pay, you can start putting 5% of your salary into another bank account. You can gradually increase this percentage as you have more house pay or feel you deserve more rewards. Many people finally pay for themselves. By the time they have paid off the other expenses, they will have nothing to pay for themselves.

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