Handle With Care
Personal finances can seem like calculus to many people. This feeling is not based on the level of education one has attained or their income level. It is based on their relationship with money. If you feel insecure about your relationship with money, then you can feel lost and afraid.
Here are some characteristics of insecure money relationships:
- living paycheck to paycheck and running out of money often
- not being prepared for a $1,000 emergency
- believing you do not have the skills to understand or to manage your finances
Here are 3 tips to improve and strengthen your relationship with money:
- Make a budget. Start with knowing your monthly income and expenses. You may need to look at a copy of your paycheck to calculate your net monthly income (after taxes and other deductions). Also, you may need to track your expenses to see exactly where your money is going. Many people who do not budget have no idea where there money is going. Click here to use my tracking tool to get started.
- Set up an Emergency Fund. The rule of thumb is to have savings for 3 – 6 months of monthly expenses in case of a major emergency, such as getting laid off from your job. If you do not have any money in savings, I suggest you start with a more manageable goal of $500 ($41.50/month) or $1,000 ($83/month). You can keep saving once you reach your goal. Get more information here.
- Start dealing with your debt. Spending and debt are major causes of financial stress and problems. Read here and use Debt Stacking to reduce and eliminate your debt. If you have $25 to $100 extra, think about accelerating your debt reduction.
Read my eBook “Money Management 101” to learn more about how to begin this journey. Consider it your money relationship manual. Your relationship with money is kind of like your your relationship with your children and other loved ones, you should handle with care. The more you know about money, the more secure you will feel about your relationship with it. Everyone deserves a great relationship with money. Sometimes you just need a little help. All the best!
Click here to get my free eBook: Money Management 101