Money can feel so overwhelming sometimes.
The good news is that you can learn how to change that.
I’ve listed 10 ways to improve your finances now that will get you started asap.
They’ve helped me go from broke grad to money pro, and I believe they can help you, too.
So, let’s get started!
Love ’em or hate ’em — budgets can help you improve your finances almost immediately.
With a budget, you track your money coming in (your income) against your money going out (your expenses).
If you do this implement a budget, you can feel less money stress every month and actually start having money for things you want to do in life (imagine that!).
Start budgeting by using one of the resources below:
- Budgeting for Budget Haters (budgeting course)
- Budget Spreadsheets (the budget templates I use)
- 11 Ways To Trick Yourself Into Sticking To Your Budget Right Now (budgeting eBook)
These resources can help you stop living paycheck to paycheck and help you create a plan for your money.
Financial freedom starts with your budget! It’s that important.
2. Make More Money
You need to make enough money meet your financial goals. If you’re not doing this from your day job, then figure out how to make extra money on the side.
Say yes to more hours at work; work toward a bonus; pick up a side job; start an online business. Whatever you do, do something!
Here are my best resources to help you make more money:
- 45 Ways To Make Extra Money (for inspiration on how to make extra money)
- 5 Day Blogging Bootcamp (for starting a blog)
- How To Start A Side Hustle + 23 Ideas (for learning how to start a biz)
- How I Made $45k Blogging In 1 Year While Working Full Time (for learning how I side hustled my way out of debt)
Whatever you do, find ways to make more money every month so you can reach your financial goals. Don’t let your lack of income be the excuse you use to stay broke.
3. Set financial goals
You need to set financial goals if you want to change your finances.
Examples of goals can be to get out of debt, pay off your student loans, or save for a new car.
Whatever your financial goals are, make sure you write them down and use the SMART method of goal setting. Download my Goal Setting Action Plan to learn exactly how to set goals. In the meantime, just know that goals should be:
Your financial goals will move you from where you are now to where you want to go. Without them, it can feel impossible to make progress financially.
4. Track your net worth
Start tracking your net worth to see where you are financially. Tracking your net worth is how you measure your overall financial health at a given time. It’s a good indicator of where you stand financially today.
To track your net worth, use my net worth spreadsheet in the Budget Spreadsheet Bundle. This will get you in the habit of calculating your own net worth, instead of just using an online aggregator.
To track your net worth, subtract your liabilities from your assets (net worth = assets – liabilities).
Every month or quarter (whichever you want), update your net worth. This will show you how much your net worth is increasing (or decreasing!) over time.
If you want to have financial success, measuring your net worth is a must.
5. Build an emergency fund of at least six months of expenses
Financial experts recommend saving an emergency fund of three to six months of discretionary expenses, or even more depending on your sources of income (if you have one source versus three sources every month).
The one thing that I know for sure is that having an emergency fund takes away the fear around emergencies with respect to how you’ll pay for them. The emergency still may stink, but you won’t stress and worry about how you’ll pay for it if you have money saved. And emergencies will happen. They happen to everyone.
Here are a few posts to help you get started with a savings strategy for building an emergency fund:
- 75 Money Saving Tips
- 4 Ways To Add $3K To Your Savings This Year
- 10 Habits That Will Help You Save Money
- How To Save An Emergency Fund That Actually Lasts
6. Get out of debt
Create a plan to get out of debt now. You owe it to your future self to get out of debt now so you don’t have to worry about it later.
As of last month, I have paid off $100k of student loan debt. This started after law school when I had $206k in debt from undergrad and law school. I still have a long way to go, but I’m using my blog income to help and hopefully pay it all off in the next couple of years. After focusing on my own personal financial education, I committed to a plan to get out of debt.
If you understand how much you get back every month by paying down your debt (which is exactly what you pay in interest), then getting out of debt becomes too good of a financial option not to do as a top priority.
This is why taking a course like Budgeting for Budget Haters becomes almost necessary — it’s really hard to do this stuff alone. It’s so helpful to have someone guide you through how to create a budget that can help you understand why it’s important to pay off debt — and how to do it asap.
7. Save for retirement
Start saving for retirement as soon as you can. There are so many different ways to save for retirement, but a great place to start is with your employer’s plan. If your employer offers a match, it’s a good rule of thumb to invest up to the match at the least. If your budget allows you to save more, then save more (or up to the max). Saving for retirement early is really important because you have the advantage of time that older people don’t have.
It’s not enough to simply start saving for retirement. You need to learn the basics of retirement saving. For that, start by reading Retire Inspired by Chris Hogan.
I also have many blog posts about retirement that can help:
- How To Start Saving For Retirement
- How To Save For Retirement In A Roth IRA
- Retirement Plans For Self Employed People
8. Check your credit reports and your credit score annually
Check your credit reports and credit score annually for free using AnnualCreditReport.com. Not only will you be aware of your score, but you will know what is on your reports and whether there is any incorrect information listed. This is one way to know whether you’ve been a victim of identity theft.
Read How to Check Your Credit Reports & Credit Score to learn how now.
9. Get insured
Make sure you have the right types of insurance in place. This is really important for some people (like if you’re married or have kids). If something tragic happens to you, having the right type of life insurance can mean knowing that your family will be financially. This type of security is priceless. To decide what types and how much insurance you need, look at different companies and compare prices using a brokerage service like Policy Genius. This will give you a way to compare policies and decide which plan is best for you.
10. Focus on building assets
Assets increase your net worth and are the key to building wealth. Wealthy people have assets (something I first learned from the book Rich Dad Poor Dad by Robert Kioysaki). If you want to build wealth, get out of debt and acquire assets. You’ll watch your net worth grow, and you’ll be amazed at how you can change your financial future just by adhering to simple rules.
A Final Note!
Three years ago, I knew nothing about money — at all.
Now, I’m a personal financial planner and blogger. I followed the steps above and changed my financial future.
I’ve paid off $100k (and counting!) of student loan debt, and I’m a spender at heart, too. So, if I can do it, I think you can, too!
Keep focusing on your financial life. You’re too important not to!