This year is proving to be financially challenging for many folks. Many are losing their jobs and/or large chunks of their retirement savings due to coronavirus concerns. While things may be rough in the short-term, there are tried-and-true methods for getting your finances under control. You may not be able to apply them right away, but whether you are struggling with debt or just trying to have a clear savings and retirement plan for the future, it’s worth getting smarter about your money and thinking about the ways you can do that.
Even before coronavirus, most of us could stand to manage our finances better. A staggering 28 percent of adult Americans already had zero savings set aside for emergencies. And 36 percent of us aren’t yet saving for retirement.
Once things settle a bit — and they will settle — you may want to consider some of these ways to improve your finances. The key is finding the things you can achieve and setting clear goals.
Here are 47 simple ways you can be smarter about your money:
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1. Figure out your budget
If you only take one tip from this list, it should be this one: Make a budget. Making a budget not only can get your finances under control, but can set you up for long-term success.
One of the keys to making a budget is choosing a system that works for you, whether that’s a snowball method for getting out of debt or a 50/30/20 budget or just a simple spreadsheet that helps you set goals and track your spending. When in doubt, keep it simple, focus on the problem areas and prioritize saving.
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2. Find areas where you can cut back
Once you have a budget, look for areas where you can cut back on your spending. You don’t want to live at the edge of your means. Rather than spending your entire budget each month, find ways to cut back so you are living slightly below your means (or even well below if you’re fortunate enough to do so).
Some simple ways to cut back and start saving money include doing home and car repairs yourself, cooking at home rather than eating out, using coupons, bringing your own lunch to work and getting rid of cable television subscriptions.
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3. Use your savings account
While you’re saving by cutting back, also save by, well, saving.
It’s a great idea to have a clear goal for your savings. That is something you can build right into your budget as well. Perhaps you want to save $500 a month and have a budget that can accommodate that. That’s a fantastic goal and can result in a robust savings account by the end of the year.
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4. Make the most of those savings
Don’t use just any savings account for this purpose, however. A high-interest savings account can double down on your investments in yourself.
Online banks offer much higher interest rates than brick and mortar banks. Opening a savings account with a company like Ally, Synchrony or Alliant can mean you get 1.25% or more back on your savings in interest.
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5. Automate saving…
Make the process of saving money and contributing to a high-interest savings account simple by automating your savings. You can set up your bank account so that a certain amount of income goes directly into savings every month. Apps like Digit and Qaptial can make this process simple and painless, but even if you find you can’t automate, setting aside a set amount each month for saving is a great habit to get into.
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6. …and bills
You can also automate your bill payments. Most banks will let you set up automatic and recurring payments. This will help you avoid late fees and missed bills. It can really damage your budget to get hit with a late fee simply because you missed a due date accidentally.
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7. Get rid of subscriptions
Many of us have so many subscription services at this point that we don’t even remember what we’re paying for. Take the time to find out what you’re signed up for and what you’re actually paying for. You may well find a subscription you didn’t even remember that is doing nothing but costing you money.
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8. Contribute an extra mortgage payment
Mortgages are one of the most common forms of debt we have. And while a mortgage isn’t bad debt (like credit card debt would be), it is still a heavy burden to bear.
Many experts recommend paying just one extra mortgage payment per year. Even one extra payment can help get your mortgage paid down more quickly and relieve you of this debt.
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9. Make the most of good debt
Speaking of good debt, let yourself hang on to it. It can feel scary to consider any debt “good,” but something like a mortgage is actually a good thing. Your house is an investment and not just a source of debt. And the same goes for student loans. These large investments in your future aren’t mere burdens, so you don’t need to cut them out of your budget in order to be smarter with your money.
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10. Cut back on credit cards
One thing you should cut back on, though, is credit cards. Pause a moment before considering opening a new credit card.
In general, you will want to wait at least six months before opening a new credit card. This is especially true if you have debt or have missed payments on your other credit cards.
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11. Make a debt spreadsheet
Speaking of credit cards, let’s start talking about debt.
Debt happens. But just because you have debt, that doesn’t mean you can’t be smart with your money.
One step you can take to get out of debt this year is making a debt spreadsheet. This will help you visualize your debt and see exactly where your money is going. Include the name of each creditor, how much you owe, the minimum payment required, the interest rate and payment due dates.
This might be a painful process, but it’s the first step to getting your debt under control.
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12. Decide your debt repayment method
If you have debt to pay back, decide how you’re going to do it (the spreadsheet from tip 11 will help!).
One popular method is the snowball method, where you take on your smallest credit card debt first. A competing theory is the debt avalanche method, where you start with whatever credit card is charging the highest interest rate.
There are good arguments for both methods so figure out what works for you.
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13. Don’t just pay the minimum
If you have debt you want to start tackling this year, don’t just pay the minimum. Figure out a budget that allows you to pay more than the minimum payment for your credit cards. Paying only the minimum on your credit card balances could mean years of debt repayment.
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14. Ask for help
You don’t have to do this alone. If you have serious debt you can sign up for credit counseling. They can help you come up with a budget that reduces your debt burden. They may even be able to help you negotiate with creditors.
Credit counseling usually isn’t free, so if you are going this route make sure the benefits will outweigh the costs.
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15. Consider bankruptcy
This is a scary one. If your debt problems are severe enough, though, bankruptcy can be an option worth looking into.
Different types of bankruptcy will mean different things, so research what will work best for you. But bankruptcy can be an option, as it means court-ordered protection from your creditors. Bankruptcy can give you a chance to get rid of unsecured debts and set up a payment plan.
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16. If you have a 401(k) from an employer…
Match it! This is one of the easiest things you can do to be smart with your money. If you are getting a 401(k) from an employer who offers matching contributions, make sure you are maximizing those contributions.
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17. Don’t stop there
For even more benefit from your 401(k), don’t just contribute up to your employer’s matching contribution. If you have the means, max out your 401(k) contributions this year. Those under 50 can contribute $18,000 per year, while those over 50 can contribute $24,000 per year.
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18. Start thinking about retirement
Regardless of your 401(k) situation, you should be thinking about retirement. Anything you can save or invest today will come back to help you later. Don’t worry about whether you’re getting a late start. Anything you can do for your retirement is a smart step to take. At a minimum, put some money in a high-interest savings account to ensure you have some sort of nest egg for the future.
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19. Get help making some investments
You can also invest in the stock market to try to make the most of your money. The stock market can be a daunting beast, though, so guidance can be very beneficial.
A financial advisor can help you with investments, though that will come with a cost. Still, if you aren’t sure where to start, talk to a financial advisor to see how you might be able to get started.
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20. Leave your investments alone
It’s easy to want to look at your investments every day and see how they’re performing, but you should resist this temptation. For most of us, investing in the stock market is a long game. There will be ups and downs. The goal, in the long term, is a net gain, but this will mean you occasionally see some dips. It’s best to try not to get too hung up on these dips and keep your eye on the bigger picture.
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21. Start investing early
There is no time like the present to start investing and shoring up your retirement funds. If you are waiting for the right moment to start, this is it. Even if you feel like you’re getting a late start, that’s better than not starting at all.
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22. Follow the old adage: Buy low, sell high
This might sound obvious, but this tried and true advice still holds. If you are just getting into investing and the stock market, you can’t go wrong with buying low and selling high.
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23. Stay away from complicated investments
Investing sounds like a complicated and confusing process, but you should keep it simple. If you don’t understand what a company does, just avoid them. Invest in things you know and understand. You’re more likely to find success that way than by investing in complicated industries you don’t understand.
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24. Think of the bigger picture
If you are investing, you don’t just want to consider short-term gain. Try to envision the bigger picture and what you want your investments to do in the long term. Especially if you are investing for the sake of retirement, try to find good, solid investments that you can stick with for a long time, rather than constantly switching things around.
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25. Consider making a calendar
Having a calendar for your investments could help you keep your goals and the larger picture in mind. This calendar could be broad, including dates like your expected retirement well down the road. Plotting out your goals like this can help you tailor your investments to the things that will actually make an impact when you’re ready to retire.
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26. Make a calendar for the rest of your finances as well
You shouldn’t just use calendars for big, long-term investments. Your day-to-day finances could also be plotted out on a calendar to help you keep track of things. A calendar can help you stay on top of bills so you don’t miss any or incur late fees. You could even include expenses like groceries. Make a calendar that shows you your financial picture for the week, month, year and long-term. This can help keep you on course, even when your finances feel overwhelming.
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27. Try to invest in high-quality companies
If you are investing on the stock market, you not only want to understand the companies you’re investing in, but also the products and services they offer. A company producing high-quality products will generally be run better than a company producing lower quality products. Go with what you know, the products and services you would trust in your own life. This is a sign of a good company that you can feel safe investing in.
Some people even go the extra mile by investing in a socially responsible way. This means putting their money where their mouth is by investing in companies trying to use sustainable products and do good for the world.
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28. Do a daily check in
Take a glance at your finances every day. This could be as simple as opening an app or just taking a look at your bank accounts.
It’s easy for this to become an obsession, so feel free to cut it back to once a week rather than once a day. In general, it’s just good to have a consistent practice of looking at your finances so you aren’t taken by surprise by some change in your financial situation.
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29. Hunt for fees
While you’re checking on your bank accounts, make sure you’re hunting for fees. Fees on things like credit cards and checking accounts can be sneaky. Look through your statements occasionally with an eye toward fees you can’t explain. The sooner you find these the sooner you can stop them from costing you money unnecessarily.
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30. Check your interest rates
You should also check up on your interest rates, especially when it comes to your credit cards. These can change with little warning. You may not even notice. So make a note of interest rates whenever you check your financials to ensure they’re still what you’re expecting to see.
If you do notice a change, it could be because you were getting a special rate for a limited time. This might have happened when you initially signed up for your credit card. You can call your credit card company and try to negotiate for a lower rate if you notice yours tick upward.
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31. Don’t forget about your credit score
While you’re doing all these check ins and scheduling, set aside a little time to think about your credit score. Especially if you are planning on some sort of large purchase, you should know your credit score and whether it has fluctuated recently.
The three credit bureaus — Equifax, TransUnion and Experian — can give you an update on your credit score for free.
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32. Save for emergencies
You need to save for more than just your retirement. Life happens. Sometimes you run into an emergency that requires quick access to money. Make sure you can weather an emergency by setting aside some savings for situations like a sudden health issue or other unexpected expense.
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33. Don’t put that savings in your checking account
Don’t count on your checking account for your savings. Even if it’s for emergencies, you should have a separate savings account for that emergency money and any other saving you are doing outside of retirement accounts.
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34. Read up
Reading books by financial experts can make a big difference in your financial literacy. Learn as much as you can by reading finance books.
You don’t need to go right for the heavy textbooks. You can start simpler. More and more finance books are being written for average people just starting to get smart with their money, rather than lifelong investors looking for an edge. Start wherever you’re comfortable.
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35. Listen up
If reading about finance isn’t really your thing, try listening instead. You can find many YouTube series and podcasts about money and finances. Listen in the car, while cooking or just when you have a few minutes of downtime. Any means you have of studying up will improve your long-term financial health.
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36. Talk to the right people
If you know people who are particularly good with their finances, talk to them. They are likely more than willing to offer advice and insight about how they manage their finances.
Even if you don’t get into deep financial discussions, simply surrounding yourself with successful people can have a knock-on effect. You may pick up their good habits simply by being around people who are managing their money well, but don’t be afraid to ask what’s working for them and how they got to where they are today.
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37. Use the 72-hour test
If you have trouble with overspending, force yourself to live by the 72-hour rule. When you have the urge to buy, place that tempting item in your online shopping cart. Then leave it alone.
That’s right. Don’t touch it. Let it sit there for at least 72-hours. Then, when the immediate rush of getting that new thing has died down, go back to your shopping cart and think about whether you really need and want this thing.
This method can help you cut back dramatically on impulse purchases that can eat into your finances.
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38. Cut down on emails about deals
Every morning, your inbox probably includes at least one piece of mail from an online store trying to sell you something. They might be offering you a steep discount that seems too good to pass up.
Take some time to unsubscribe from these emails. These ads can coax you into spending money that should be going into your savings and investments.
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39. Ditch the overdraft protection
If you are managing your finances well, you may not need overdraft protection. Instead of paying for overdraft protection, you can use some of the techniques and apps mentioned above to keep you on track and ensure you don’t overdraft or miss any crucial bills. Of course, if you get it for free, by all means keep it.
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40. Look into an FSA
An FSA, or Flexible Spending Account, can allow you to set aside money for medical expenses that won’t get taxed. This is a great way to stay prepared for an emergency while also managing your finances. You can contribute up to $2,600 a year to an FSA.
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41. Invest in your health
You don’t only need to invest in retirement funds and stocks. Long-term investing also includes thinking about you and what you may need in the future.
Joining a gym and staying up to date on doctor visits is another form of investment — an investment in yourself and your long-term health.
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42. Switch to cash
We rely on credit cards a lot in our daily lives, but many of those purchases could be made with cash. It’s tempting to stick with plastic because it’s so convenient and easy, but that also makes it a trap that gets us locked in debt. Switch to cash wherever you can. You may be surprised by how much it changes your spending habits in places like the grocery store.
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43. Cutback on credit cards
Even if you can’t totally switch to cash, you can still cut back on your use of credit cards in general. Try to only use credit cards for purchases that are absolutely necessary. Where you can, pay with cash or check.
Also, avoid opening new credit cards and adding to your debt. If you can reduce the number of credit cards you’re carrying, you may find yourself less tempted to use them as well.
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44. Take a class
There are lots of classes out there about financial literacy. Find one near you and learn from an expert. Books are great, but seminars and training events can get you face to face with real experts in the financial sector who can advise you on how to manage your money.
Classes and seminars can also help if you are making investments and need to stay updated on trends. Experts can watch the markets more closely and diligently than many of us can. Make use of their deep knowledge.
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45. Stay married
Divorce is expensive. But beyond that, married couples tend to have higher incomes and twice as much savings available when they retire. Going by simple math, married folks are in a stronger financial position when they retire.
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46. Create a will
It may seem early to make a will, but this document is actually great to have around. It is not only security for you, but also your family. A will can ensure your finances are protected even in the worst case scenario.
If you have a spouse or children, you may want to consider talking to a lawyer about writing up a will. This will ensure you know exactly what will happen to your finances.
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47. Give yourself a treat
With all this hard work you’re doing to save and manage your finances, you deserve a reward. It’s OK even while getting your finances in order or paying down debt to treat yourself once in a while. If you only focus on the hard parts, you could get discouraged or overwhelmed over time. Take a second to appreciate your hard work.
This article was produced and syndicated by MediaFeed.org.
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