The Real Reason Your Finances are a Wreck

If I had a dollar for every time some indebted sap clicked on a “No-Spend November” post or signed up for the next coupon app… But true financial freedom is not in a Pinterest-worthy quick fix (though I have found much personal finance inspo from the interwebs myself). Put it another way, as much as I want to lose weight, simply double tapping fitspo Instagrams, my butt is never going to get in shape that way. Similarly, financial freedom from the debt and spending cycle only comes from building financial literacy and practicing smart financial moves until they become habit.  And your finances will be a wreck until you stop looking for quick fixes and make significant behavior-altering changes and improvements. Want to get ahead, but don’t know where to start? We’ve put together for you our top tips for getting your finances in order. Happy reading and good luck!

Stop reading this article and sign up for Credit Karma. 

Or another free credit monitoring service. I know you just started reading, but you will never–I repeat, never–experience financial freedom if you are in the dark about your financial health. Never. Credit Karma is my preferred tool because it provides a user friendly interface that gives a good estimation of your FICO score, informs you of any hard pulls and their expiration, and warns you of any delinquencies negatively affecting your score. The “report card” format is especially helpful  at showing what you’re doing right and what you can be doing better. Paid sites may provide more bells and whistles, but these intro sites are more than enough to get you started. If you have certain credit cards, your provider may have a FICO score benefit and you should check that regularly as well.  For me, my American Express, Citi, and Discover Cards all provide this service.

Call your creditors to synchronize your payment dates.

I’m a firm believer that consistency is one key to happiness. There is way too much stress and trying to remember when one bill or another is due. And I certainly do not have time for late payment charges. Pick one date soon after payday, call your creditors to confirm the switch, set a e-alert, and commit to paying all of your bills on that date. Added bonus: automating payments immediately after your paycheck clears will prevent you from spending that “extra cash” just laying around. And while you’re on the phone with the bank…

Ask for a lower interest rate.

I’m not an advocate of carrying credit balances from month to month, but…baby steps. If you absolutely have to, make sure you call your creditor regularly to ensure you are getting the best rate. I do this every six months like clockwork, but have had success asking after just three months! Unsure how to get results? It’s simple. Dial the toll-free number on the back of your credit card, fight the annoying prompts by saying ‘representative’ every five seconds, and when you finally reach a living, breathing being, ask for a better APR.

Build extra income.

If you’re feeling financially underwater, advice to give up $4 lattes seems particularly misplaced. You should already have done that. And cut cable, mani/pedis, weekly blowouts, and drinks out with friends (grab a nice bottle and head to the park). Already work a 9-5? Well there are 16 other hours in the day. And the sharing and social economy that has sprung up over the last couple of years makes it pretty easy to pad your savings or pay down debts more quickly with a few extra dollars.


Bankrate.com Bankrate.com retirement planning

I love this infographic that shows the power of socking away as little as $50 per month. And with side hustles, you can easily earn that much, if not more. Side note: Pinterest is replete with resources about the wonderful world of the “side hustle”. There a host of Pins dedicated to this very topic and reviews on the best ways to make some side cash.

Move.

We all want to live out our dreams of riding into the sunset in the Hollywood Hills or writing a memoir in our apartment overlooking Central Park. But if you are working a minimum wage job that is easily replicated in a cheaper locale, it’s time to think about a change of scenery. This is the hardest advice to come to grips with, but very few municipalities are doing what is necessary to ensure living wage opportunities. Depending on your politics, that’s a sad fact. But if it’s your reality, don’t just sit there. Do something. Weigh the tangible and intangible costs and benefits of relocation. And then act rationally.

Educate yourself.

Don’t know the difference between a 401(k) and a Roth IRA? You aren’t alone, but you certainly aren’t doing yourself any favors continuing your ignorance. Personal finance, wealth building, and investing isn’t just for the über-rich or those with unlimited free time to consume CNBC. You too can pull the curtain back on Wall Street by learning from accessible online resources like Investopedia or The Motley Fool. When we were beginning our journey towards financial freedom, we signed up for the Investopedia Term of the Day.  Each day a new finance word is delivered to our inbox, along with a definition, and often a cute video explanation (hello visual learners). These baby steps spoonfeed financial literacy to you every single day. And while it sometimes is a lot to remember, some portion of it will stick and will eventually become useful as you begin to invest in your future.

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