Enjoy this guest post from Jackie Waters with Hyper-Tidy!
Planning for the future may seem like a scary prospect, especially when you’re not yet financially dependent. It can be difficult to think about the best ways to save money when you’re in debt, so it’s important to think about the best ways to start making some changes.
It may feel overwhelming at first, so get some support from friends and family and consult a financial advisor if you feel you need some help. In the meantime, you can follow these tips to help gain financial independence and start saving and planning for the future.
Put your money to work for you
Investing your money can pay off big down the road, so seek the help of a financial advisor who can help you figure out where to put it. You can invest in real estate or try a low-risk venture, such as a money market account.
Look at your debt
One of the most important things you can do in the beginning is to look at your finances in detail and assess all your debt. Student loans, home loans, credit card debt, and unpaid bills are all things you’ll need to plan for when you’re saving. Look into whether you can work out a payment plan on some of the bigger outstanding debts and let your family know what sort of preparations you’re making so you can gain their support. It can be difficult to start saving and cutting down your debt when friends and family are inviting you out for expensive dinners, vacations, and events.
About those credit cards…
It can be tempting to open up a line of credit at the store when they offer a discount on your purchase, but resist! Those credit cards are an obstacle between you and a debt-free life, so when you need to make a big purchase–furniture, appliances, etc.–save up for it and pay cash.
As for those cards you already have, make a plan for paying more than the minimum amount due each month. This will help you put more toward the principal rather than paying so much in interest fees.
Work out a budget
One of the best ways to start planning is to work out a budget for you and your family. Take a look at what you’re bringing in versus what’s going out and sit down with your spouse or partner to make sure you’re both on the same page. It may be necessary to make some cuts, and while that might sound a little scary, keep in mind that you can do this in small areas at first. For instance, exchange cable television for a subscription service, or look for a cheaper cell phone plan.
The next step in preparing a budget is to spend less than you earn. It may sound like a no-brainer, but for many families, this is tougher than it seems. Credit cards have given people the ability to live outside their means, but without that safety net things can get ugly really quickly. Keep a close eye on your finances and make a commitment not to go over budget.
Consider a second job
It seems like there just aren’t enough hours in the day sometimes, but if you’re finding it difficult to begin saving while you’re paying off your debts, consider getting a second job or working from home part-time. If you’re creative, there are many options, including freelance writing, making and selling items on Etsy, or offering services such as tutoring or tech support.
Learn to say no
Trying to save money and plan for the future is hard enough without outside influences standing in the way. Friends and family may mean well, but it’s important for you to learn how to say no when they ask you to go out or spend money extravagantly at events and parties. There’s no need to be rude, simply be firm and politely decline the invitation.
Remember that saving money takes time, and when it’s for something as important as your future, it’s important to get it right. Start slow and get some professional advice if you feel overwhelmed.
Looking to put your money to work for you by investing in real estate? Always feel free to contact me at 713.829.3052 or cynthia@cynthiamullins.com.
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