7 Hacks to Manage Money Better

The ability to manage one’s money is a coveted one. The person who masters managing their money can master managing more money. That basically means that if you can’t appropriately handle the income you make now, you won’t be able to handle more money coming your way.

Just like any skill, managing money can be worked on and perfected. There are certain hacks to manage money better that can help you along the way. Forming a new habit does not happen overnight, but it can (and will) get easier over time.

I’m sharing 7 hacks to help you manage money better so you can open the door for more money to come your way. Put yourself in a position to be as knowledgeable as possible about your financial situation, starting with these 7 things!

#1 Track your net worth

What is more motivating to get your life in order than seeing how you progress or digress over time? Essentially, your net worth is your assets minus your debts. If you have more debt than you have cash in the bank, you have a negative net worth.

While a negative net worth can be a downer, it can also be a motivator. I suggest you start tracking your net worth month over month and keep an eye out on the change. I do this for myself, and it is extremely motivating. You are able to see how your debt grows or decreases, as well as how your savings grows or decreases month over month.

Here’s how to track your net worth:

  • Open an excel spreadsheet
  • Each tab equals a new month
  • Do this at the end of every month
  • List all of your assets (bank account balances, 401k balance, investment balances, etc.)
  • List all of your debts (credit cards, student loans, auto loans, mortgages, etc.)
  • Subtract total assets – total debts to get your net worth
  • Copy the tab each month to track your new month

You can also use that information to pinpoint inconsistencies in your budget or spending. If your net worth doesn’t improve month over month, something is wrong. You are accruing more debt or spending more of the cash you have.

#2 Always use cash back shopping

Cash back shopping means you are shopping on websites where you get a percentage of the amount you spent back, you get rebates, or you get an extra discount for shopping.

There are plenty of resources available to help you get cash back or extra discounts on whatever you spend. Since this is true, you should never purchase something full price or without getting something back in your pocket.

I wrote an entire article about why I love cash back shopping, and I share my favorite cash back resource when I shop. I have cut down my shopping significantly over the years, but if I ever need to buy something, I make sure I can get a discount or get cash back for my spending.

#3 Track your spending against your budget

There’s no doubt you’ve heard me talk about the importance of tracking your spending, but did you know it’s a great hack to manage your money better?

When you track your spending and compare it against your budget, you are training yourself to always make sure your spending stays in line with the limits you set for yourself in your budget. Ideally, you would want to track your spending every day and see how close or far you are from spending in any particular category of your budget.

Tracking your spending and then comparing it against your budget gives you fair warning if you are going to overspend. Instead of playing the “I didn’t know” or “I didn’t realize” card, you now know exactly where you stand and where your money went.

#4 Balance transfer to 0% interest cards

Caution: this, by no means, is permission to accrue more debt. If you have a problem spending on your credit cards, then just go ahead and skip this section.

If you are diligently paying down your debt, but interest is kicking your butt, try transferring your balances to a new card with 0% interest for a specific amount of time. If you have old cards that have been paid off, call the lender and ask for any promotions available to you.

Often times, lenders will offer promotions to customers with zero balance to get them to use the card again. You can use this to your advantage and transfer balances from cards accruing interest. Now, you will be paying down the same amount of debt, just not accruing the same amount of interest.

This hack only applies if you are budgeting your money and not overspending. Most people who complete balance transfers or consolidate debt rack it right back up. Don’t put yourself in a position to fail.

#5 Save when you get paid

Have you heard the term “pay yourself first?” I’ve mentioned it numerous times, and most personal finance experts recommend it. Paying yourself first means that you put money right into your savings account to minute you get paid.

If you put money into savings right when you get paid, you are less likely to come up with an excuse to spend that money. It’s almost like the “out of sight, out of mind” theory. Your money goes straight to savings, so you don’t even have a chance to miss it.

Give it a try! Set up direct deposit directly from your paycheck to your savings account. Make sure you start with an amount you won’t need or be tempted to touch. As you get accustomed to this amount going into your savings account every pay period (and you don’t touch it), increase it over time!

#6 Leverage resources that help you save

There are plenty of resources out there to help people save more money. Are you taking advantage of all or any of them? If you can make saving money easier on yourself, why wouldn’t you want to take advantage?

Here are a few resources, off the top of my head, that you can start leveraging today to help you save more money in the long run:

  • Apps like Digit, Stash and Acorns
  • Contributing to an HSA or FSA
  • Taking advantage of your 401k match
  • Bank features like Way to Save (Wells Fargo) and Keep the Change (Bank of America)
  • Keeping your money in a high-yield savings account
#7 Master budgeting, then master increasing your income

I mentioned this at the beginning of the article – if you can master managing the money you have now, you can handle and master more money that comes your way.

Once you get your budget in order, your debt paid off, and your savings to a reasonable place (emergency fund, ideally), then you can handle making more money.

People think that making more money is the cure to budgeting problems and debt, and that is far from the truth. If a person can’t control their spending when they earn $40,000 a year, they won’t be able to control their spending when they earn $150,000 a year. While earning more money can help you solve your problems faster, it can only do that when you have acknowledged the problem and worked to remedy it.

Why do you think people who make good money can’t figure out why they are so deep in debt and have no savings?

Following a budget, tracking your spending, and becoming debt free all need to happen before you can handle more money coming your way. Once you are on track with those areas, you can seek more money. You will know how to handle it. You won’t go back into debt. You will leverage it to make you even more money.

Related: 7 Money Moves to Become Financially Independent

 

I no longer want to hear you feeling sorry about your situation. I want you to do something about your situation! You can master managing your money. I believe in you! Schedule a free consultation with me, if you want more guidance and help along the way.

Do you do any of the hacks above to keep tabs on your finances? What hacks can you share? If you have questions about anything I’ve mentioned above, or if you want to share your own experiences, leave a comment below!

-Raya
The CGS Team

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