Smart Money Habits Everyone Should Build
When it comes to getting your finances under control one of the best things you can do is to put time and energy into building habits that will save you money, help build a stronger financial situation, and even improve your credit over time. Building small habits towards a healthier financial situation is easier than you think and can really help make the most of your budget even as it gets tighter and tighter as the prices of everyday essentials like food and gas rise.
The importance of building smart money habits
We all struggle with money at some point in our lives. You may not know how to control your budget when you don’t bring in enough money to cover your basic needs because you have bad habits of overspending. As time wears on and life throws us through loops we find that these struggles evolve from year to year and even week to week.
Maintaining healthy habits is a great way to manage your life better and work towards your goals. In the same way that you work to create small habits to help make you healthier, you can develop small habits that can help you manage your money better.
Building smart money habits allow you to take control of your finances and take some of the burdens off your shoulders. There are so many other effective ways to form smart money habits that will make your daily life easier. These include placing your change into a jar when you enter the house.
Like with other areas in our lives most of us have some pretty unhealthy money habits that could use some help on our end to get under control. Breaking a bad money habit like impulse spending by replacing it with a small and effective positive habit like asking yourself if there is a better financial choice before making an impulsive purchase can really add up when it comes to improving your finances.
Smart money habits you need to build
Developing smart money habits is one of the most effective ways to make managing your money easier. However, first, you need to have some ideas of what smart money habits you should form. Remember that it takes an average of 21 days for a new habit to be formed. Work on one or two habits at a time. If you are familiar with the Fly Lady system you will know that you should best work on a new healthy habit each month to give it time to stick.
Setting goals regularly
Developing a habit of setting money goals can make managing your finances easier. Setting money goals on a daily, weekly, and monthly basis will help you build this habit. Creating monthly goals can be as simple as reviewing your budget and setting goals that meet each of your family’s needs. Breaking down your budget into weekly increments and deciding what you need to do to make it work is weekly goal setting. Establish daily spending limits, schedule days when you won’t spend a dime, and work to achieve these goals.
When you have a partner you are sharing finances with this should involve talking to your partner on a regular basis. One of the best money habits I have made is to touch base with my husband and to tell him when a bill is paid that may not come out right away or to even tell him what a limit on his spending is for the day to avoid the overdraft fees he used to rack up.
Make a habit of paying bills ahead of time
While it can take a while to get started when you’re on a tight budget, it can help you manage your bills more efficiently, as well as protect you from late fees that can significantly increase your bill. Working on this one step at a time, starting with the bills with the biggest late fees.
Avoidable fees like late fees and overdraft fees are some of the most avoidable pitfalls many families fall into and find eat away at their already tight budgets.
Paying off your credit card in full if you use one
Paying off your credit card in full every month is a smart money habit that can help you save money and raise your credit score. Carrying a balance shows that you are utilizing more of the credit available to you, as well as paying more in interest.
This is one of the most common pitfalls of credit cards that can lead to a major loss of money from your everyday budget. When you do not pay off your credit card right away you are paying more in interest that can really add up fast and make something that feels like a great deal much more expensive.
Comparing prices at the store
When you shop at the store, compare prices to save money. Take the time to compare how much everything costs per unit and build this into a habit every time you shop to save hundreds of dollars a year.
Comparing prices and shopping sales is one of the best ways I work to help fight inflation and save money as the prices of just about everything is skyrocketing. You can check the prices of things online at most stores before shopping to help find the best deals.
Keep an eye on the sales. You are missing out on a great opportunity if you do not take advantage of sales and stock up on items when the prices are low when it comes to basic needs like food and personal care products. At least once a week, check sales for items you use frequently. As the cost of everything continues to rise, stockpiling sales can be a very effective way to combat inflation. Shopping sales allows you to save on everything from laundry supplies to meat at the grocery store.
Buying used items
Buying used is a great way to save on everything from fitness equipment to baby items to clothes for your kids helping to boost your budget by making your dollar go further. Look for something used before ordering online or going to the store if you need something. If you choose to buy used, you’ll be surprised to discover how many great things are available for a great price. Finding deals on used items in the spring is particularly easy because everyone is decluttering as they work through spring cleaning.
Turning off things you are not using
If you think of money habits, you may not think about eco-friendly options such as simply turning off things you are not using, but this strategy can save you hundreds of dollars annually. You can turn off lights when you leave a room, turn on a space heater in the room you are using and set your thermostat lower to reduce your power bill, or simply turn the water off while you scrub the dishes, then rinse them all at once to reduce your water bill.
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