10 Things Every Clever Girl Should Do For Financial Success

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A lot of times, the world of personal finance many seem complicated and confusing but below are 10 simple things that you can put into effect for your personal finances to make things less complicated and make planning your finances so much easier.

1. Pay yourself first

Contribute to your retirement accounts (401k, 403b, IRA, ROTH etc.) and also to your emergency fund each time you get paid. You can make it easier by automating your contributions as soon as you get paid.

2. Understand your credit score

Know what your credit score is and keep track of it. Your credit score is very important especially if you intend to leverage credit by applying for a loan towards a major purchase such as a home. The reason being that your score is one of the main factors that will determine what interest rate you get which in turn can save or cost you thousands of dollars over the life of your loan.

3. Build credit responsibly

To  build your credit, opt for a cell phone bill you pay monthly instead of a credit card you will be tempted to max out. If you do use credit cards, ensure you pay them off in full every month. Don’t open unnecessary lines of credit or rack up debt you don’t need.

4. Remember your credit card is not a debit card

While your debit card is linked to your bank account and tied to money that is all yours, money from a credit card is not free money. You will have to pay it back and with interest if you carry a balance for more than a month so you definitely want to be careful about how you spend money on credit.

5. Save at least 10% percent of everything you earn outside of your retirement account

Open up a savings account that you don’t touch and is not easily accessible and save, save, save. This way if any unplanned financial obligations come up you don’t have to rely on credit. You can also split your savings into categories like emergency fund, travel, shopping, new home purchase etc.

6. Understand cost per wear

This is the cost of an item divided by the number of times you’ve worn the item. For example, something you wear everyday has a low cost per wear while something you wear once a month has a high cost per wear. Factor this process into your shopping and you’ll get more bang for your buck.

7. Track your spending, manage your expenses

Having a budget is really important for your financial success. It will help you understand where your money goes each month and allow you to make sure that you keep your expenses lower than your earnings. The goal here is to get your expenses as low as possible this way you have more money to save or pay off debt.

8. Only buy what you can afford

You can do this by staying within the budget you’ve created. This means you are spending less than you earn which in turn means you’ll have money to save. If you want something but can’t afford it, find an alternative or save for it over time.

9. Learn about investing; Don’t invest in anything you don’t understand

Long-term investing seems like a deep dark hole but it’s the way to build wealth. There are so many terms thrown around it’s hard to keep up but you can start by learning the basics of what investing is and what investment avenues exist. Pick one, do your research, talk to an expert and then decide if you are ready to invest.

10. Keep educating yourself

Read financial books, blogs and watch some well-reviewed money shows. There are a ton of great resources out there that can help you get better with and keep you motivated about your personal finances.

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