Your personal financial circumstances are not necessarily the same as your neighbor’s, but you might be surprised how much we all share concerning money matters. After all, when it is all boiled down, our common goal is balancing resources, so incoming cash flow is adequate to cover spending.
For some fortunate earners, income exceeds what’s needed to make ends meet each month, with money left over to save and invest for the future. Others struggle a bit more, eking-out each month’s financial obligations with little left to set aside. Still more of the working population is in transition, recovering from job loss and other financial setbacks. Notwithstanding your personal financial fitness, at each level of income and stage of individual financial development, sticking to a consistent set of habits leads to the best outcomes. If you are committed to maximizing income and stretching your financial resources as far as possible, commit to these proven practices shared by prosperous people:
Work More – Although it seems an obvious correlation, it is worth restating income has a source. Passive earnings from investments and business enterprises is ideal, keeping cash trickling in, without daily input from you. If you are like most, however, at least some share of your personal income is directly derived from deliverables. Selling goods and services, performing on the job functions, consulting, doing piecework and other forms of earning are the basis for generating cash flow; so the more you work, the more money you’ll have on deposit. Although ‘work smarter’ is a valuable adage, pointing to the limitations of small-time thinking, working harder and longer are also tied to higher earnings and professional fulfillment.
If you are paid by the hour, generate added income by picking-up extra shifts or covering co-workers vacations during time away. If your employer has maxed-out the need for your services, it may be time to expand your earning potential, moonlighting at another place of employment. If a career change is on your horizon, this supplemental employment could be used as an opportunity to break-in to another field. Consulting and helping with contract projects are other ways to earn extra income within your discipline, offering part-time relief, with potential for future growth. Outside your primary line of work, hospitality and entertainment jobs furnish side-income with a social aspect some part-time servers, bartenders, and service staff find rewarding.
Pay Attention to the Economy – General economic conditions influence every aspect of personal finance. Unless you take an active role watching-out for your financial future, however, your security and comfort are at risk. To make the most of your current earnings and protect savings and investments, try to cultivate financial understanding – especially with your partner and family members, who all have a stake in household money matters.
Even if you are not a student of finance, it is important to stay informed about interest rates and other economic principles. Especially if you are getting ready to buy a car or make a major purchase, use online resources to evaluate options. Sites like readies.co.uk, for example, highlight personal loan rates and terms from various lenders. Mortgage conditions are also of concern to homeowners, so successful personal money managers stay abreast of home loan rates and financing opportunities. By tracking rates and recognizing economic trends, informed investors know when to refinance, sell and buy homes.
Track Your Financial Status – Life’s hectic pace sometimes keeps us away from things that are important. Unless you are a financial hobbyist, or bent on micro-managing household cash flow, there is no call to obsess over daily finances. Still, staying atop money matters, setting financial goals, and evaluating progress are all wise practices, leading to financial security.
In order to remain current about household finances, schedule periodic financial reviews – at least quarterly or twice annually. Tax-filing season is a good time to go over cash concerns, because documentation and spending records are at-hand for review. Include debt analysis in your examination, especially regarding new purchases added to your repayment load. Are payments manageable? Is there a more reasonable financing option available? How long will payback carry on? Answering these and other questions gives you updates needed for planning and allows for adjustments, as you look ahead toward financial goals you’ve set. Your financial review should include a look at these spending areas:
- Insurance
- Car Payments
- Mortgages
- Outstanding Credit Card Balances
- Student Loans
- Upcoming Expenses
- Income Changes…
Even the best laid plans go afoul, but knowledge and discipline help families avoid being blindsided by changing financial fortunes. Making the most of every work opportunity and staying informed about economic influences – at home and across your region, give you the tools needed for financial survival, health and security.
