For better personal finances, nothing beats good planning and motivating goals. With the right tools (and a little discipline), you’ll not only be in a better position to make your plans a reality, but you could also achieve financial independence. Here are our expert tips for better managing your money.
Having trouble managing your money? It’s normal, it’s far from easy! So how do you manage your monthly budget? The secret to getting there? Simplify your personal finances. The more you simplify them, the easier to manage and therefore healthier they are. Simplification is the key word to better manage your personal budget or the family budget. But before we begin, I have to warn you of something. Once you start simplifying your money management, you won’t be able to stop!
Tips to better manage your money
Personal finance books like all sites specializing in wealth management emphasize the creation of a budget and the monitoring and good management of it. Why is it absolutely necessary to create a budget? What benefits can we derive from its implementation? Discover the reasons to create a monthly budget.
Focus on one goal at a time
Typically, people often have more than one financial goal at the same time. They try to pay off their debts, but also to put money aside, to save for retirement, to save for the education of their children, to save for a wedding. Suffice to say that it is mission impossible and very discouraging! Instead, try to put all your might on 1 goal at a time. If the goal is to reduce your debt, then just focus on trying to reduce your debt. If you are saving for a real estate purchase, then put all your energy into saving as much as possible for that purchase. Simplify, focus your efforts and prioritize one goal at a time. With this technique, you will gain confidence in yourself, because you will see that you are really moving towards the only goal that you have set for yourself. Once you have achieved this 1st objective, continue your momentum and move on to the next one.
Keep one bank account
Do you really need 2 checking accounts, 4 savings accounts and 3 retirement savings plans? I seriously doubt it! No wonder many people find it difficult to keep track of their personal finances! How do you want to navigate it easily when you have a multitude of accounts to manage? It’s hard enough with just one, so with several in different banks. The best is to have 1 single current account, 1 single savings account, and 1 single retirement savings plan and that’s it!
Pool your finances with your spouse
For me, if you are married or in a civil partnership, it is essential to have only one bank account. Having only one “financial life” is the winning solution every time. Take the time to create a unique account with a set of financial goals. In addition, bank charges will be halved! So when do you start?
Cancel all your credit cards
Yes, you read that right. I said cancel all your credit cards. Why? First of all, there is less risk of identity theft and scams of all kinds. But that’s far from the only advantage. You also have fewer accounts to manage at banks with questionable practices, fewer bank fees to pay and less paperwork to manage. Not to mention the price of credit cards that are not given! Your best bet is to have just one debit card and pay as much cash as possible.
Make your budget using pen and paper
This is a method of managing a budget that I adopted recently, and I must admit that it is super effective. Here’s the logic behind this trick: If you can’t get your budget down on paper, it just means your budget is too much to manage. This method will force you to establish much broader expense categories. As a result, this will encourage you to reduce your monthly expenses, as they will appear more important than if you had a multitude of categories. In addition, unlike a computer screen, writing the details of your budget by hand allows you to better “integrate” it mentally and better understand it.
Use the income from the previous month to establish your budget
This trick is super effective for 3 reasons. First, it forces you to be at least a month ahead of your payments. This means that you have at least a small margin of safety. Second, it allows you to establish a budget even when you have an irregular source of income. And thirdly, this method is interesting, because since previous income by definition can not change, it easily turns into a zero-sum budget. Each euro is thus allocated to a specific category at the beginning of the month.
Pay for your purchases in cash
Try to settle as much as possible of your expenses in cash. For this technique to work perfectly, you have to go even further to be able to “visualize your budget.” An example? Use paper envelopes to organize your tickets under each expense category. It’s a great way to concretely visualize the month’s budget and avoid going over it. If you look in the “entertainment” envelope and see that it’s only $ 4 in it, you know you’re not going to be able to take the whole family to the movies tonight.
Pay all your bills on the same day
When we look at his debits, we realize that the bills are debited throughout the month. The telephone on the 5th of the month, the Internet subscription on the 20th and so on. The concern is that this does not allow you to anticipate expenses. So the idea of this trick is to pay all your bills on the same day. When possible, choose the same debit date for all your invoices. I also use it to pay the monthly mortgage payments. Some invoices are a little more complicated to pay in advance, but trust me, it is with great pleasure that most companies accept payment in advance. This method drastically simplifies your daily life and saves a lot of time. And it is all the easier to implement if your budget is established from the income of the previous month.
Make a payment schedule
If you can’t pay all of your bills on the same day, then make a calendar dedicated to your bills. This lets you know exactly when you are going to have to pay the bills. And if you’re using your computer’s calendar software, you can even add automatic reminders to make sure you never miss a monthly deadline. That way, no more late payment penalties!
Immediately write down each of your expenses as you make them
It is very important to keep track of each of your expenses so that you know where your money is going. You can write them down in a small notebook that you always keep with you. Or you can also list them in your smartphone via the Notes app. Regardless of the strategy, use the one that works best for you. The important thing is to note the expense immediately after making a purchase. And this is true for a product as well as for a service to which you subscribe.
It may sound subtle, but there is a big difference between synchronizing your expenses with budget management software and the act of physically recording every expense. This device has a positive effect on spending habits. Indeed, it helps you to think carefully before giving in to an impulse buy. Don’t worry: once put into practice, this trick will quickly become automatic.
Use our tips to save money easily
For example, set up a no-expense weekend or even better try to survive a month without any expense. Also try to freeze some of your daily expenses (for example: no cinema for 1 month, no daily coffee on the terrace, etc.). Give yourself some time to make sure that these recurring expenses are really essential to your well-being. If not, you know what you have to do. At the same time, make a list of all the supposedly necessary things that you want to buy. Wait 30 days before rereading your list, or at least 2 days if you can’t hold it that long. At the end of this period, only buy the things that you consider still necessary. You will see that the list will certainly have decreased!
Always think about the overall cost of an expense
When making big purchases, never think about the monthly cost of the expense, but rather the total cost. Why? Because talking in terms of monthly payments is a marketing technique to make you believe that a service or a product is cheaper than it really is. It is therefore smarter to think, negotiate and buy in terms of the total cost or the lifespan of the product in question. This allows you to understand the total price of the product in question. This tip also applies to contracts and various subscriptions. Always ask yourself the question: what is the total price that I will pay? Again, this tip is going to help you make less impulse buying, not burden yourself with unnecessary things, and most of all, pay less monthly payments.
Automate the management of your finances as much as possible
Take advantage of online payment services and open an online bank account, for your checking account as well as your savings. It’s much easier to manage than sheets of paper. However, the idea of direct debits doesn’t really appeal to me. Certainly, modernizing your financial management to take advantage of one-click payment is a smart way to simplify your life. On the other hand, concerning direct debits, this deserves reflection. It is indeed important to keep some control over each of your payments. For my part, if I have chosen to pay most of my bills online, I first validate each payment, each month. Why? Because it allows me to carefully examine each invoice and detect any errors or a change in tariff that the service provider would try to sneak in.
Always opt for the electronic invoice
Opt for electronic invoicing with as many services as possible. Scan and save all your important paper documents to keep them electronically. Much easier than if you have to find information on paper. For this, I recommend the online tool Evernote which allows you to scan everything and find your documents easily by text recognition. Finally, do what you can to reduce advertising mail. It’s not only better for the environment, but it’s also better for your mental health. How to do? It’s simple, if you receive flyers from companies, call their customer service the same day and ask them kindly to unsubscribe from their mailing list.
Combine your mobile, box and TV package with the same supplier
It is much more economical to combine these 3 services with the same operator. Why? Because whether it’s Free, Bouygues, SFR or Orange, they all offer discounts when you have the 3 services at home. For example, Bouygues is currently offering a special Box + Mobile / TV offer at only € 14.99 for 12 months. Having only one supplier also simplifies the process in the event of a breakdown or if you need to contact customer service. You thus know the customer service number and the address to send a registered letter if necessary. In any case, avoid at all costs subscribing to additional services that you do not really need.
Clean up your “press” subscriptions
Press subscriptions are deceitful (especially the cheapest), because they can quickly add up and represent a considerable cost. Therefore, beware of press subscription offers that give you a few months free. Indeed, once you are in the magazine’s customer files, they will never let you go so that you subscribe at full price!
Avoid taking out long-term contracts
Mobile plans, gym memberships, or private sales club memberships are services that you do n’t need to commit to with a contract. Therefore, stop taking out new contracts and always think “no obligation.” Only choose contracts that are absolutely essential to your daily life. For the rest, there is almost always an equally interesting non-binding alternative in terms of pricing.
Set up your own “emergency fund”
Building up an emergency fund is an essential strategy, because it will help you gain peace of mind. You will have more peace of mind by “having your back covered.” Once this fund has been established, you will wonder how you could have lived without it, so serene it makes you feel! In addition, for my boyfriend and I, it has totally changed the way we manage our budget. This fund has become like additional insurance that reassures us and on which we pay a little bit of money regularly. The idea of this emergency fund is to free themselves from questions of interest rates or tax optimization, while having a back-up envelope in the event of an unforeseen event.
Get rid of all your debts
When I say “all your debts” I even mean your mortgage. Imagine what a life like when you don’t owe anyone money? Freedom! Today, I paid off my student loan and can’t wait to finish paying off my mortgage, because I know I will feel more free. To simplify your life, getting rid of your debts, one by one, should be your first goal.
Train yourself to live in “artificial scarcity”
What does it mean to live in “artificial scarcity”? It’s actually a technique to help you save even more. Imagine that you managed to save 1000 € on your livret A in a few months. Instead of saying to yourself, “what am I going to be able to do with my 1000 €”, pretend that this savings no longer exists. Get it out of your head and try to keep saving as much as before. Why? Because it will force you not to rest on your laurels. Result at the end of the year, instead of having spent your livret A, you will have managed to put another 1000 € aside! Plus, if one day you really need to save more, you’ll be psychologically and logistically prepared to do so, which will make it a lot easier.
Simplify your investments
My theory about investing is this: If you can’t explain to someone simply and quickly the value of making that investment, it probably means you shouldn’t do it! Simple and very effective, isn’t it? You don’t have to be a finance pro to know that when it comes to investing, you must always simplify them as much as possible as well as diversify them.
Stop gambling on the stock market
Stop trying to predict the market and gamble on the stock market. Exceptions are rare, and you’re unlikely to find the deal of the century that no one saw coming (even if your cousin has a “super tip”). Playing your money on the stock market is like an emotional roller coaster. However, the stress generated is the exact opposite of your simplification process. So flee the risk in the stock market!
Go home-made
Simplicity isn’t just about doing things that save you time and money. It is also to act in a more ecological way. So, living on less is possible. Use “home-made” products as much as possible, cook more and learn to craft instead of buying something back when it stops working or is damaged. That said, it’s important not to waste your time: which brings me to the next point.
Outsource part of your tasks
It’s a reality: learning to be “self-sufficient” takes a lot of time and practice. Therefore, sometimes it is better to spend your energy on things that you can add value to. And above all, sometimes it is better to entrust certain tasks to a professional rather than wasting time trying to do them yourself. In summary, outsourcing something to a professional makes sense when it saves you time, reduces stress, and saves energy and money.
Make a list of all your material possessions
Well, we’re not going to lie to each other: listing everything we own is quite difficult. His interest? Starting this list will make your simplification process easier. On a daily basis, this will encourage you to consume less, spend less and accumulate less material goods.
Then within 15 days, sell half of what is on this list
This is where things get interesting! This kind of challenge will push you to simplify your life, for 3 reasons. First, selling half of the goods on your list will save you money. In addition, you will save money (on maintenance, upkeep, the cost of renting a storage unit for all your unused items, etc.). Finally, this tip will increase your productivity and your quality of life. Why? Because you will be able to focus on the really important things in your daily life.
For each item purchased, get rid of 2 items that you already have
To simplify your life, you will need to get rid of unnecessary items that you have at home. Indeed, once you have successfully changed your consumption habits, it is important to keep the momentum going. Adopt this simple and effective principle + 1 = – 2 It will help you control your spending, borrow rather than buy items and most importantly, it will encourage you to spend your money better. Instead, you will be able to use this money to live enriching experiences, alone or with others, such as traveling with your family or parachuting!
Use alternative means of transport
Ditch your car completely. To do this, research the different means of public transportation available in your city and region. Take the bus, regional express trains (TER) or metro. Also, try to move closer to your workplace so that you can cycle there. Most importantly, walk more often. In addition to the health benefits (less stress, more exercise), you will save a lot of money (car credit, repairs, vehicle registration, fuel, car insurance, etc.).
No more than one car per family
It’s true, sometimes the car is essential, especially when you live in the countryside. Don’t worry, it is still possible to make your life easier! Indeed, more and more people choose to have only 1 car for the whole family. It’s also a great way to simplify your life. Whatever you do for a job, you will have a hard time explaining to me why it is essential to have 2, or even 3, or 4 cars! And yet, it is very common for families to have several cars. But do not forget: each more car, it is as much expenditure on fuel, insurance, repair, cleaning.
For your next car, choose a compact car
Why? Because small family cars are cheaper to buy and often less expensive to maintain. But be careful, I didn’t say you have to buy a new car: used cars are often much more interesting. You can easily find recent and very reliable used models. Just take the time to do your research on the Internet. And even better, prefer an electric car which will cost you much less in fuel and repairs! Especially since at the moment there are interesting purchasing aids for electric cars.
Rent out your home first before you can be sure you can own a home
Owning a house or an apartment is the number one enemy of financial simplicity. With the crisis behind us, we know the dangers of carelessly buying property that is too large or that does not meet your real needs. I am not at all against becoming an owner, but you have to be 100% sure you can afford it financially before embarking on this adventure. Why? Because you must be aware that becoming a homeowner will make your financial life much more complex to manage. You have been warned!
If you decide to become an owner, choose a condominium apartment
If you really want to own a home, an apartment in a condominium is one of the best options. Of course, that doesn’t mean it’s less complex than buying a house. You will have just as many problems to deal with afterwards. But at least it will be much more economical to share the co-ownership costs with the other owners of the building, than to bear all the costs related to the maintenance of a family home.
Don’t buy a home larger than what you really need
If you are planning to buy, try to choose a house or apartment that is not too big. Indeed, most people give in to the temptation to have more space than they really need. As a result, this subsequently leads to financing concerns, because housing that is too spacious also means an increase in all costs (purchase price, mortgage, insurance, maintenance, charges, etc.). Each additional square meter will be felt on the total bills at the end of the year. In addition, this implies that you will have to encumber you with even more objects to fill this additional space. Today there are plenty of tips to save space at home, look here to see for yourself.
Simplify your sources of income
In theory, having multiple sources of income seems like a pretty good idea. But in practice, it can have the opposite effect and slow down your productivity for each of these activities. For me, the ideal is to have 1 main source of income and supplement it with only 1 “secondary” source.
Identify what you do well and do it more often
If you are an employee, try to identify the things you do that add the most value to your employer. Once identified, focus on them to keep doing them better and better. It is by capitalizing on your strengths that you will increase your efficiency and professional satisfaction. If you’re your own boss, the idea is to identify that little extra thing that makes what you bring to your customers unique. Whatever added value is, this is what you need to focus on because it sets you apart from your competition. Stop running 10 hares at once, stop trying to do everything for everyone.
9 reasons to keep money
Before I show you the main reasons for keeping money, remember that you need to have discipline and create a habit, because you need to be aware that you will be doing this every month. A very important question concerns the setting of short, medium and long term goals. And from there, you think about how to achieve them. It is essential that you make a financial plan, put everything on paper and analyze the steps you need to take to achieve whatever you set as a goal in your life, and that is exactly what it is for. important to save. Now, we’ll tell you the reasons to start saving today.
Pension supplement
Be aware that, generally, the retirement amount does not cover all of your expenses. And if you want a quieter retirement, you better start saving now. If you do not have a private pension and you only have the INSS, the amount you receive at retirement is much lower than it would be if you were active. So separate part of your salary each month and invest. The goal is for the money to earn and supplement your retirement.
Take a specialization course
Today, faced with a complicated time in the country, a professional specializing in one field can make all the difference, greatly increasing their chances of obtaining a good placement in the labor market. Think that by saving money you are investing in yourself and your qualification.
Buy a property or a car
This is just as true for you who live on rent and think about owning your own house, as it is if you want to change ownership. In the case of the car, it works the same, although the value to be saved is much less, of course. But whether it’s buying a property or a car, it’s important to set goals. And in this case, reserve each month a specific amount for this purpose. Buying a home is a very expensive investment. For buying a house you can also try to begin a small business for more income.
Monthly payments, accounts, taxes, and unexpected expenses are inevitable. To simply qualify for a mortgage, you must have saved a down payment of approximately 5% of the value of the home in question. In addition, since we cannot predict the future, it is important to have more money saved when buying a home than it may seem necessary, in case you are forced to face unexpected expenses, such as a home repair. emergency or maintenance required. Saving enough money for a down payment can take several years, not to mention all of the other expenses we mentioned above, so it’s a good idea to start saving sooner rather than later.
Provide better education for children
As for the issue of raising children, the sooner you start thinking about it, the better. A lot of people only worry when their kids are getting ready for the vestibular, but if you take the example of the United States, for example, parents have been saving money for college since their kids were kids.
Have peace of mind in the event of job loss
No one is safe from losing their job overnight and have you ever wondered what their life would be like if it happened? How will the invoices be paid? But if you have a reserve of money for this purpose, you will have much more peace of mind and can focus on finding another with more calmness. You may think like many people that job loss or temporary disability cannot happen to you. You might not think you need to prepare for this particular scenario. But the reality is that thousands face these terrifying scenarios every year. Do you have enough money to cover your expenses while you find a new job? Time for convalescence?
Take a dream trip
Taking a trip is a dream for many people, but depending on the destination and the time of day, it can take a toll on the budget. A tip for not compromising your budget is to save each month. So you can make the trip without compromising your financial planning.
Book your leisure activities
You know spending on leisure can get you out of control, especially if you’re used to dining out, going to concerts, or traveling on weekends. It is therefore important that you save a portion of what you earn to cover these expenses.
Save money for cash payments
The great thing about paying with cash is that you can take advantage of great opportunities, and of course not get into debt. When you buy on installment you run the risk of paying high interest and as soon as you have money in your pocket you have the chance to get a much better deal. There are thousands of small expenses in everyday life that can often seem endless. These small expenses add up quickly and can become difficult to manage. Avoid getting caught up in another vicious cycle of debt because you don’t have enough liquidity to meet demand. Even if you found an easy way to make money online you need to be careful with your expenses.
Save money to pay off debts
Suppose you have incurred credit card debt or a special check. Know that if you have an amount to repay this debt, it is very advantageous. Most of the time, banks offer discounts of up to 80% on your debt and if you have money saved you can use it for this purpose. If you’re in debt, whether it’s a student loan, credit card, personal loan, or even a mortgage, you owe it to yourself to make saving a priority. Your debt will not go away on its own; it is far too easy to make minimum payments without realizing that the interest on some debts can make them insurmountable financial burdens.