Managing money is hard, even with all of the good advice out there. Often, ignoring personal finance best practices is the easier way to go, which is why so many people do it.
Certain money tips for everyone typically aren’t often put into practice, even if they work. Here are a few that everyone should follow, but so many people don’t.
1. Make Saving a Priority
Most people are aware that they should “pay themselves first.” It’s a common money tip, and a powerful one to boot.
But, when you’re struggling to pay bills, it’s a hard one to follow. However, by not focusing on saving, you may spend more on frivolous items since the funds are “available.”
Even if it’s just $20, redirecting something to savings every paycheck is important. If this isn’t a technique you use, you should start today.
2. Automate Everything
When it comes to managing your finances, automation is your friend. Scheduling your savings deposits and bill payments ensures you won’t forget these essential to-dos. This makes it easier to stay on track and helps you avoid missing payments or overlooking your savings goals.
3. Avoid Lifestyle Inflation
If you end up with a raise or promotion, it’s tempting to treat yourself. While a single extra purchase doesn’t do much harm, succumbing to lifestyle inflation does.
Lifestyle inflation happens when you begin spending more money, instead of saving or investing, when your income increases. By avoiding lifestyle inflation and focusing on growing your assets, you can set yourself up for a stronger financial future.
4. Avoid Unnecessary Borrowing
At times, borrowing money from a financial institution is practically unavoidable. After all, most people don’t purchase their homes or cover college tuition with cash.
But, excessive borrowing can set you back, saddling you with interest payments and harming your cash flow.
While you may need to borrow some money from time to time, make sure alternatives aren’t available before you go forward. For example, if you can save up the money for a large purchase, that’s always preferable. And your wallet will thank you for your effort.
5. Not Having a Budget
A budget provides you with a framework for your finances. It helps you track your outgoing money, ensuring everything ends up in the proper place.
It’s also a powerful tool to for future planning, making it clear how much you have available after you handle your expenses. That way, you know exactly how much can safely be sent towards your savings goals.
Why These Money Tips for Everyone Go Ignored
Ultimately, managing money is hard. It’s challenging to avoid lifestyle inflation, saving instead of borrowing, and sticking to a budget. That leads some to ignore great money tips, even if they work.
But, by following some of the advice above, which are genuinely money tips for everyone, you can get ahead.
Got a great money tip? Share it with us in the comments below!
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Tamila McDonald has worked as a Financial Advisor for the military for past 13 years. She has taught Personal Financial classes on every subject from credit, to life insurance, as well as all other aspects of financial management. Mrs. McDonald is an AFCPE Accredited Financial Counselor and has helped her clients to meet their short-term and long-term financial goals.