When it comes to money, learning to be financially responsible with it requires a dedicated effort. Just as you’d work hard and put in the time and training it might take to be successful at anything else in your life, working to become financially free also requires plenty of time and patience.
Below, we break down some simple tips you can implement daily, weekly, monthly, and quarterly so that over time, you can develop the important habits you need to become financially independent:
Daily
- Log your spending. It may seem tedious, but logging your spending or purchases each day doesn’t have to take you a ton of time. Simply open your notes app on your phone or keep a small notebook handy in your purse and log your purchases one at a time throughout the day to keep you honest. Over time, it’s likely that you’ll begin to notice your spending triggers and purchasing behaviors and may even make you more thoughtful about how you continue to spend going forward.
- Save your receipts. Sure, you may not need every single paper receipt that you collect throughout the day, but some may be worth saving. Keep a portion of your wallet free for receipts and create a folder on your computer or in your email inbox to archive those digital receipts. It is never a bad idea to hang on to certain documents to show proof of purchase, payment updates, recurring expenses, or contractual obligations.
Weekly
- Establish a meal plan and grocery shop accordingly. Take a few moments at the start of every week to map out your meals and grocery needs so that you can avoid unnecessary impulse spending throughout the week to satisfy your hunger.
- Review those all important financial account statements (i.e. your checking, savings, and credit card statements). Reviewing these statements weekly gives you a better chance to catch any errors or inaccuracies before they turn into major headaches.
Monthly
- Get to work on that budget. Establish your budget at the start of each month and then check-in at the end. Aim to understand what changes you may have to make, how you can get back on track, what you might have to adjust ahead of the next month.
- Transfer money to your goals. Funding those retirement goals, emergency savings, or other funds is a lot easier to do if you set aside time each month to do so. To make things even easier, set up or schedule automatic transfers to take place to fund these goals for you!
Quarterly
- Check your credit score. You are entitled to a free credit report every twelve months from each of the three main credit bureaus: Experian, Equifax, and TransUnion. Log on to one of the credit bureaus each quarter to find out where you stand. When viewing your score, be on the lookout for any suspicious activity. If your score seems wildly out of line with your expectations, do a double (or even tripe) check of the report. If anything seems suspicious, contact the credit agency to make an inquiry and make sure you are not a victim of identify theft or any other fraud.
- Update and calculate your net worth. Your net worth is your total financial value after assessing the value of everything you OWN: your assets (i.e. investments, residence, real estate, etc.), subtracted by everything you OWE: your liabilities (i.e. consumer debt, outstanding mortgage, student loans, etc.). Every financial decision should be made with the end goal of increasing your net-worth. To calculate this, start by listing all of your assets and their known values. Note* to determine the current value of your home or automobile, it can be helpful to consult Zillow or Kelley Blue Book to determine the fair market value. Then, make a list of all of your liabilities, and subtract the two.
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