It’s a new year. You might have a ton of goals in mind that you want to achieve throughout the year. If one of them is dealing with your personal finances without the stress, this is the guide for you.
We will be taking a look at the five key elements that will make it all possible. Before you know it, you’ll feel like a wiz when it comes to handling your money. Let’s begin with what you need to know right now.
Put money away and let it sit there
One of the things that you can do is put aside money in an account and let it sit there and accrue interest. In fact, it’s possible with what is known as a CD (or Certificate of Deposit). You can even get one with 5.35% APY from GreenState Credit Union.
Whether you know it or not, CDs are still useful even today. You can put money away in a specific account where you pay little to no fees at all. Compare that to a traditional bank account that may nickel and dime you with every fee and surcharge they mention in the small print. For those in the Midwest, exploring cd rates in Indiana can offer competitive interest rates that further enhance the benefits of choosing a CD over a traditional bank account. It's always best to compare cd rates to find the best possible interest options.
Be smart with investing
You don’t have to be a billionaire hedge fund or a genius to invest. However, if you plan on investing extra money into something like stocks, it’s important to be smart with it. It may seem a little challenging at first, but it will seem easy to do once you know some of the basics.
Of course, doing your due diligence will be important when you’re planning on investing in the stock market. Because you will make an informed decision of whether or not the stock you’re looking at is worth putting money into or not. If you have any questions or concerns about the stock market or investing in it, there’s always a financial advisor that can help.
Build an emergency fund ASAP
Here’s the thing: emergencies can happen at any time and any place. So it may be a good idea to build up an emergency fund as soon as you can. You can do this by way of opening up a separate bank account that is solely used for this purpose.
Each time you get paid, set aside 10 percent of it in the account. You can continue doing this for an indefinite period of time. Having peace of mind knowing that you have the money for anything that happens “all of a sudden” can be a good feeling.
Do not touch this emergency fund for any reason other than emergencies. There’s a reason why it’s called that, you know. But don’t worry, you should still have enough extra cash to invest in your self-care if you need to.
Chip away at debt
Debt can weigh you down like a lead balloon. So the sooner you chip away at it, the better. If it seems insurmountable, don’t fret - there are plenty of debt consolidation and repayment solutions. It may also depend on the type of debt that you’re saddled with.
If your debt is linked to your child’s college education, you could qualify for some kind of forgiveness. Just remember that the more you take care of the debt you may have, the better your credit score will be.
Plus, you’ll feel the weight lifted off your shoulders with every bit you pay off. So gather as much as you can about the debt you may have and deal with it accordingly.
Be mindful of your spending habits
Look, it’s fine to treat ourselves whenever we feel the need to do so. There’s nothing wrong with that. The issue is that a lot of people don’t draw the line somewhere.
As for yourself, you need to do that. The priorities in terms of the money you spend will and shall forever be the essential expenses - food, utilities, housing, etc. So it wouldn’t hurt to put together a budget to map out how much money is spent on what.
Your discretionary spending is something to keep track of as well. It should also be the kind of spending that you need to look at whenever you need to make spending changes or cuts. Because there is no way you should prioritize non-essential spending over the essential.
Sometimes, you have to swallow hard and cut out the Hulu if you need to. We get it, you might not be able to catch up on your favorite shows. But keep in mind that they won’t be going anywhere for a long time (unless Hulu says otherwise).
Sacrifice can be so rewarding when it comes to bettering your financial situation. Besides, you can breathe a sigh of relief knowing you can make the rent or mortgage payments each month when you have the money to do it.
Conclusion
A stress-free personal financial plan is something we all strive for. If you follow these five ideas above, you’ll be in the driver’s seat. You won’t have to worry about your financial situation once you’ve ironed all the wrinkles out.
Plus, you don’t have to have a ton of money to no longer worry about it. All you need to do is pay off any debt you may have, save up for emergencies, and be smart with every dollar you have - whenever and wherever.
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