Step 1: Make a Plan
First, set your financial goals. Whether it's saving for a house, a car or concert tickets, figure out what's important to you and make room for it. Then, list all your sources of monthly income. After that, estimate all of your monthly expenses- bills, gas, food, etc. Now compare the lists. If your expenses are more than your income, it's time to trim. Money left over? Increase your savings.
Step 2 : A Dollar a Day
Day-to-day savings can pay off big. Cut back where you can, try buying generic brands, carpooling, going to a matinee or purchasing sale items. Also, eat at home more -- you'll save on coffee runs, deli stops and dinning out, which really add up. Finally, go outside! Bike riding, hiking ad camping are great ways to have fun without spending much money.
Step 3 : Who Wants To Be a Millionaire?
It's not that hard, you can do it for less than $167 a month. How long will it take? Depends on your interest rate: at 6% - 59 years; 8% - 48 years; and %10 - 41 years. The key is save consistently. And, the more you invest and the higher the interest rate, the more quickly you will reach your financial goals!
Step 4 : What's in Your Wallet?
Credit cards are useful for emergencies and building your credit history, but be informed: When it comes to credit cards, knowledge is power! Pick a card with a low annual percentage rate; the higher the APR, the more money you pay. Stick to using one credit card; multiple cards means more to manage. Try to save your credit cards for emergencies, and use a debit card for everything else. Pay on time to avoid costly late fees and a poor credit history. Avoid cash advances, they can cost you a bundle.
Step 5 : Know The Score
Stay on top of your financial situation: if you don't keep track, it will set you back. Here are some tips on how. Balance your checkbook! It can be tedious but it's cheaper than bouncing checks and helps build good credit. Make managing your money as easy and convinient as possible. Locate a bank that offers features like online banking, free checking, and an abundance of ATM locations. Being aware of your finances will help you avoid going into debt, enable you to invest and save wisely, and help you build good credit, all of which will allow you to create the financial future desire.
Don't wait until it's too late, go on the offensive and take control!
To order copies, contact Melissa Thornton, community outreach/public relations coordinator at Melissa.Thornton@CalCPA.org.
