Pocket Money or a Long Term Investment?
Wise approach to personal finances can drastically increase your savings. Since we are living in the age of fast internet and mobile apps, we can upgrade our finance tracking with some of the most advanced financial software, and figure out great ways to earn and save more funds. In this article we will give you a few great tips on how to bring your personal finances in order.
1. Use personal finance tools
Running personal finances became much less complicated, since the introduction of personal finance tools, like Mint or GnuCash. With these mobile apps people can easily track all of their spendings and earnings. They connect to bank, credit card, retirement and investment accounts and record all transactions. In addition to that, most of these tools come with bar code readers that can be used for recording cash purchases.
Users have the ability to create monthly, daily and weekly spending plans, and apps give them warnings if they overspend. With all these advanced goal-setting features, users are able to determine exactly where their money goes and to improve their spending, so they can put more money on their savings, 401(k) or investment accounts.
2. Become a freelancer
Digital age allows us to monetize all skills that we have. Anybody can be a freelancer, and more than one third of American workforce is already doing freelance gigs. You can find work on websites like Upwork.com and Fiverr.com, which cover wide selection of niches from graphic design and content creation to different fields of engineering and marketing. Of course not all freelancers use this concept for getting an additional income, there are plenty of people who do this as a main job. This type of engagement can also be very rewarding, but it requires much more effort and expertise.
3. Start saving money for your kid’s school
One of the biggest problems for young college graduates today is the huge amount of student debt. Student loans are often as high as 0,000; they come with huge interest and can’t be pardoned or written off after declaring personal bankruptcy. Many students are forced to take these loans, because their parents weren’t investing money in their college funds, and due to very high tuition fees and cost of living in student dorms, especially when it comes to private colleges.
High school education is not much different. Parents also spend huge funds for paying children’s high school tuition fees if they decide to send them to private schools. In some cases they even need to take loans, which is fine considering good-quality education children are getting in these private establishments. For all of these reasons parents need to start saving money for their kid’s college and high school, as early as they can. They should use benefits of various 529 plans, when it comes to college education, and when it comes to high school, there are many solutions like school easy pay, that allow parents to pay children’s high school tuition fees and other expenses in up to 12 monthly installments.
4. Start saving for retirement as earliest as possible
401(k) and other retirement plans offer great benefits. They come with compound interest and tax deduction and most people who start saving early retire with solid six figure amounts, while the few lucky (smart is probably the more suitable word here) ones, retire as millionaires. If you are working for an honest and caring employer, they will definitely offer you up to 6% of match to your 401(k) investments, which is like getting free money.
Unfortunately, not a lot of people recognize all the benefits retirement plans bring. They start saving money when they are well off in their fifties or even sixties. Most of these people wait for retirement with ten or twenty thousand dollars on their account and dependence on welfare checks. With thinking about retirement money, as early as in your twenties or thirties, will leave you enough funds to spend your old age under the sun.
Handling your personal finances in a good way can drastically improve your standard of living and direct more money into your saving and investment accounts. Today many individuals and households use advance ways of financial tracking, which enables them to save more and live their life to the fullest.
Author: Sonya is a passionate business consultant from Melbourne, Australia. She has a wide range of interests, including online writing, technology trends and marketing in general. However, she likes to share her own experiences in the fields of money saving, considering it's her main focus.
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Business consultant, Blogger at Bizzmark Blog
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