How Do You Approach Your Personal Finance?
Have you thought about your approach to personal finance? Many people have not.
We think about money ALL the time! But we are thinking about how to get it, how to spend it, and how to move it from one place to another to make things balance out.
On the other hand, if you want to have an ever improving financial life you need to think about your approach to personal finance and make decisions with a No Drama Approach.
In this world of drama everywhere you look and an ever growing media working 24/7 to get your attention using one type of alarming statement or another, the fact is that when it comes to your personal finance, drama is the last thing you need.
Here are fives steps that will help you keep financial drama out of your life and exchange it for peace of mind and a great financial future!
your goals by reading and thinking about them. Seek out credible sources of information that have a track record of offering sensible advice and avoiding get-rich-quick thinking. Take it all in and begin to formulate your plans for spending, saving and investing.
your goals and share them with friends or relatives to gain support. Let people around you know what you’re trying to do. It will make the goals more real to you, and it’s always good to get encouragement in the early stages.
your limited resources to prioritize saving and debt reduction. Take a hard look at your income and think about the best way to distribute it. Do you have high-interest debt? Prioritize paying that off. Save as much as you can along the way, but put your focus on getting debt-free first.
your progress on a periodic basis, ideally with a friend or mentor. Studies have shown that people are more likely to reach their goals if they broadcast them to their social circle. Even when you don’t feel like following whatever system you’ve laid out to reach your goal, you’ll be more likely to bear down and get it done if you know that friends or family will be aware of your progress — or lack of it.
what you’ve accomplished and reward yourself in a positive way. When you reach your goals, pat yourself on the back. You can even splurge — a little — on something you enjoy as a way to reward yourself. Discipline is wonderful, but sometimes it’s good to have some fun, as long as it doesn’t undo the progress you’ve made. – Nasdaq
Your Approach To Budgeting Makes All The Difference!
Now that you have a No Drama approach to personal finance its time to make a budget that can help you achieve every financial goal you have. Take these simple steps and develop those good financial habits. If you do, your budget will work for you to get you where you want to go!
How to Budget Like a Pro
Set a Budget, Period
This is the starting point for every other goal in your life. Here’s a checklist for building a knockout personal budget.
Consider an All-Cash Diet
If you’re consistently overspending, this will break you out of that rut…
…Take a Daily Money Minute
This one comes straight from LearnVest Founder and CEO Alexa von Tobel, who swears by setting aside one minute each day to check on her financial transactions. This 60-second act helps identify problems immediately, keep track of goal progress—and set your spending tone for the rest of the day!
Allocate at Least 20% of Your Income Toward Financial Priorities
By priorities, we mean building up emergency savings, paying off debt, and padding your retirement nest egg.
Budget About 30% of Your Income for Lifestyle Spending
This includes movies, restaurants, and happy hours—basically, anything that doesn’t cover basic necessities. By abiding by the 30% rule, you can save and splurge at the same time. – The Muse
What is your approach to personal finance?