Tips to Creating the Abundance and Calm you Deserve!
Often at the start of a new year, one of our most popular resolutions is to become more financially stable and responsible. Overspending and overextending ourselves often comes from a place of lack and not feeling as if we have enough. It is an emotional issue as much as a material one.
Sometimes we feel as if by controlling and increasing the material volume of lives, we feel more abundant. Not only is this not true, it has the opposite effect. The more we spend our money in non-constructive ways, the worse we feel and the more we spend to feel better. Vicious cycle much?
Money is a deeply personal subject and financial circumstances vary greatly from individual to individual and family to family. There are no one-size fits all rules regarding money but there are some general tips that work well for most people.
1. Where are you over-extending? Do an honest expense report for yourself. Where are you spending too much? Rent is a common culprit -- experts say this should not be more than 20 percent of your income. Moving to a cheaper place is extremely freeing!
2. Automate your savings. This is a trick many financially savvy people know about. Before you spend a single cent -- put away at least 10 percent of your income into a savings account. If you can, put all bonuses (or any expected income) into this account too. Name it something fun like "Round the world ticket" or "Dream Home" to remind you why you are socking cash away each month.
3. Limit the entertainment overdose. Eating and drinking out are often the reason the old catch phrase was coined -- to have too much month left at the end of the money. Only commit to things you can afford and don't say yes to things just because you are invited.
4. Know where your money goes Be aware of how you are spending your money. A $4 cup of coffee five days a week costs you $80/month. Review some of the items you spend your money on to find areas where cutting back can move your savings account forward.
5. No spending one day a week. This can be played creatively like a game! If you have a transport pass, food in the fridge, coffee in the cupboard and wifi at home -- you are set. A walk outside, making lunch for your partner and Skyping a friend are all free and fun!
6. Remember less is more -- need all those cable channels? Need that gym membership if you only go once a week? Look for cheaper alternatives. How much is a drop in exercise class? Is there a free first pass? Is Hulu a better option? Refer to your report to see where you can cut back.
7. Carry cash. Not only does this make you feel wealthy -- you are less likely to want to dole out cash on things like cabs and the small things that add up (another mimosa, a t-shirt on sale). Swiping plastic does not have the same realization as to what you are spending as handing over cold, hard cash.
8. Plan for retirement Take advantage of interest and market upturns by saving for retirement early. Often your employer will help you save for retirement with a 401(k) plan. You can also benefit from pre-tax contributions using this method of retirement savings.
9. Get tax advice If you have circumstances that create tax dilemmas (e.g., self-employed, own and/or lease property, etc.), make sure to seek tax advice from a professional for the best outcome.
10. Protect your credit You have the right to pull a free credit report from each reporting bureau once per year by going online to www.annualcreditreport.com. Sites like KreditKarma also offer free credit reports. Keep in mind that late payments will adversely impact your credit, as will a failure to pay. You should immediately report any credit issues or discrepancies to the reporting bureau. Use your credit wisely and ensure your reports are accurate.
11. Keep good financial records Utilize online tools as well as paper copies of receipts to keep records of your pay stubs, banking information, taxes, insurance, and other documents important to your financial situation.
12. Give! Paradoxically, being generous makes us feel abundant and the universe rewards us by giving us more.