Life is unpredictable. Your secure job gets outsourced. You fall in love. Your brand new car needs repairs. Your kid flushes his toy down the toilet. Things totally out of our control can happen at any given moment. While you may not ever be fully mentally prepared for life’s little surprises, you can be financially ready to take them on without having to panic or scramble.
Seem like wishful thinking considering your current situation? Here are four easy money hacks you can start doing today to make the impossible possible.
1. Have an emergency fund. Living paycheck to paycheck can make saving money seem nearly impossible, but you don’t have to go from $0 to $1,000 in one shot. Start small by direct depositing anywhere from $10 to $30 each week into a savings account. (Think of it as those three coffee shop venti lattes you could make at home for $1.00). When that money gets automatically put into another account, you won’t even miss it. You won’t have to go through the mental spending of it and talking yourself out of all the reasons you should be saving it. Once you start seeing the extra zeros behind the $10 or so you started with, you’ll be surprised (in a positive way) and be encouraged to up your direct deposit even more!
2. Expect the Expenses – and save for them. Make a list of every expense you can think of, from property taxes to dentist visits, and then figure out how much you need to save each month to pay for them. For example, if your property taxes on your house and car combined are $3000, that’s $250 a month ($62.50 per week) you can also have direct deposited into a savings account. At first it can seem like a stretch, but it certainly beats the alternative of having to go further in debt because you weren’t prepared.
3. Eliminate debt. Speaking of debt, setting up a debt repayment plan is imperative. When you take a look at how much you’re spending in interest each month on your loans and credit cards – money you’re paying for convenience that’s well over and above the original purchase prices – you just might be motivated to make this your #1 priority. This can seem overwhelming and intimidating, so setting up a free consultation with a financial planner is a great first step. (See also https://jmvfinancialservices.com//4-wrong-and-a-right-ways-to-reduce-your-debt/)
4. Live below your means. I know. I know. It goes against everything American to have less than the Joneses, but more than likely you don’t even know the Joneses or what kind of stress they’ve amassed from trying to maintain their lifestyle. As with everything, baby step your way into this new mentality and way of life by automating savings; reducing your weekly fast food lunches and coffees; carpooling to work and school; and any other creative way you can come up with to take the financial pressure off of you and your family now. Your future selves will thank you as well!
But don’t go it alone. We’re here to help make the transition fun and stress-free, so reach out to us today to get started.