6 Smart Money Rules

Want to improve your finances? If you’re like most people, the answer is a resounding “yes!”Check out these six smart money rules from our experts.

1) Create a budget. You can start with a simple one. List your net income on one piece of paper. Then list your monthly expenditures on another. These will generally be your rent or mortgage, any car loan payments, and food costs. Then add in your utilities, credit card payments, and any other outstanding loan payments you have. Total your bills and subtract that number from your income. You need to know how much you have left over (if any) so you can decide how to best pay off your debt.

2) Track what you spend. Little purchases can add up quickly. A lunch one day, a few lattes in the mornings on the way to work, impulse trips to the grocery store. Any of these can kill your budget. To get a clear picture of what you’re spending, keep all of your receipts for a month – every single one. You can’t plug the leaks if you don’t know where the holes are.

3) Bargain for purchases. Don’t assume you have to pay full price. Depending on the item, many retailers will price match with competitors to give you the best deal.

4) Unload high-interest debt as quickly as possible. This normally means credit card debt. Find out which ones are charging you the highest APR and concentrate on paying them off first. If you only make minimum payments every month you will be in debt forever.

5) Review your monthly statements. Whether you receive paper statements or access your accounts online, it’s important to check them often. Get into the habit of taking ten minutes a day to look over your bank and credit card accounts. It’s smart to have a clear picture of your finances at any given moment.

6) Employ the 72-hour rule. Never heard of it? It’s simple and it works! Impulse shopping wrecks a budget. So before you buy something (new clothes, jewelry, sports equipment) give yourself three days to think it over. Research suggests that most people forget about whatever it was they wanted to buy- the initial “thrill” is gone. It’s not always easy but keeping emotional shopping under control is vital to successfully managing your money.