Spring is a great time to refresh your finances, clean up old habits, and work towards new financial goals. Here are six ways to take control of your money and work toward meeting your savings goals this year.
1. Analyze your spending habits
Whether you achieve your savings goals or not comes down to your spending habits. We’re all guilty of having a couple of habits that have the potential to steer us off course. So a good place to start is to take a look at your spending habits.
Perhaps you indulge a lot in takeout food or coffee. Maybe you spend a lot on the latest fashion items. These things are not inherently bad. You should be able to spend your hard-earned cash on things that bring you happiness within reason.
However, if these habits are roadblocks to achieving your goals or saving money, it could be time for a rethink.
Rather than cutting those purchases out entirely, perhaps you could set aside a small monthly budget for them instead.
2. Review your ongoing bills
Ongoing monthly bills may feel like they’re unavoidable, but there is some wiggle room to reduce your expenses here.
For example, you might be able to renegotiate the price for your phone bill or internet service. You could also switch your health insurance to another provider or find a cheaper energy solution. Even shaving a few dollars off each month can make a big difference.
Next, take a look at those ongoing bills that can be cut more easily, like entertainment subscriptions. If you’re signed up to multiple streaming services, try cutting one of them for a month and see how it goes. You may discover you don’t need all three!
3. Reorganize your paperwork or digital documents
Take stock of how you currently organize your financial documents. Do you have overflowing folders containing loose pieces of paper? Are your digital folders or spreadsheets a bit of a mess?
Spend some time giving these a spring clean, and it’ll make them much less intimidating to face later on.
Start by sorting out your must-keep pile of documents, like tax and pension statements. The rest of the stack can usually be cut back to just the last few years of statements. Or, file them in an electronic format by scanning them and storing them digitally to reduce clutter and stay more organized.
Next, if you have digital files all over the place, find a new way to organize these documents into folders that are labeled clearly. It makes everything much easier to find when you need to.
4. Revisit or create new goals
A big part of becoming more financially savvy is making long-term financial goals. If you haven’t already created some long- or short-term financial goals, spend some time thinking about what you want to achieve over the next six months, year, or even five years.
Get these goals down in writing, along with some step-by-step actions you can take to achieve them. It’s a good idea to regularly revisit them to remind yourself and stay on track.
5. Check your credit report
Another great thing to do while spring cleaning your finances is to take a look at your credit report. This is a good time to check if there are any issues with it that you can rectify or any actions you can take to improve it. For example, pay down debt faster or reduce your credit utilization.
6. Rethink your budget
Whether you already have a budgeting system or have been veering off course with it, now is a great time to rethink your monthly budgeting system.
If you’re finding it tough to stick to a strict budget, try out a more relaxed approach like the 50/30/20 method. This popular method involves setting aside 50% of your income to needs (bills, necessary expenses), 30% to wants (fun stuff), and 20% to savings (retirement, savings goals).
This means you don’t have to give up things you love doing, which makes the budget much more sustainable long-term.
Make revisiting your finances a regular habit
Refreshing your finances doesn’t need to be a spring-only event. To ensure great financial health now and in the future, make the above tips a regular habit and part of your routine.
To get even more control over your spending, try out a prepaid card from Western Union.
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