Some financial gurus make personal finance seem complicated, but it's not. The quickest and easiest way to financial success is to create and execute a financial plan that is straightforward, simple and doable. If you really want to achieve your financial goals learn 5 personal finance tips you should start using now.
The Truth about Financial Planning
It's true, personal finance goes well beyond targeted saving, spending and investing. It's even more than writing down a few financial goals, contributing to a retirement account, working to improve credit scores or reducing debt. All those things are important, but they are not enough.
That's why it often feels confusing.
And probably why many people who develop a financial plan to achieve their goals get stuck like a deer in headlights.
But that does not have to happen to you.
How to Reach Your Financial Goals
Apply the following 5 personal finance tips below right now and begin your journey to financial success:
1.Assess Your Financial Goals
In personal finance, your first point of reference is assessment. You must regularly check your progress. For example, one of your goals could be to save money for college. How much money have you saved thus far? How much more do you need to save? Assessing your financial goals helps you to stay on track.
Establish financial goals, create a budget that works and stick to your plan at Mint.com.
2.Budget for Periodic Payments
Short-term planning is often overlooked, but it shouldn't be. It lays the foundation to achieve long term goals. Intermittent expenditures can cut deeply into your long-term goals. If your car or a major appliance goes out, it needs to be replaced. Where will you get the money to pay for it? What would you do if your roof starts to leak? You don't want to pay for periodic expenses with your retirement or college savings.
Provisions should be made to cover short-term expenditures such as vacations, gifts, holidays, medical bills, repairs and replacements. Allocate a portion of your monthly expenses to pay for periodic expenses. If you don't know where to start, look at last year's periodic expenses, add up the sum and divide it by twelve. Set aside that amount every month to pay for your short term expenses.
3.Check Your Credit Report and Scores
Having a good credit score is powerful. It is the cornerstone of personal finance because it impacts three critical areas of your financial life: your ability to earn, spend and finance money. Not only does it gives you access to better interest rates which result in more savings, future employers often use it to make hiring decisions.
Auto insurance companies even check credit to determine premiums. Check your credit report and scores with the three main credit bureaus at least twice a year. AnnualCreditReport.com will provide you with a free credit report annually from the three big credit bureaus: Transunion, Equifax and Experian.
4.Donate Your Property to a Good Cause
If you itemize deductions, you may be able to save money on your income taxes when you donate to a qualified charity, church or religious organization. A qualified charity will have a 501(c) (3) tax-exempt status. Ask your favorite charity if they have this status, most do. Remember to keep any letters of appreciation, receipts, and appraisals that you receive for your donation. Not only will you do a good thing for a good organization, you'll feel good, free up space and save money.
5.Evaluate Your Tax Strategies
Mid-year tax planning is just as necessary as year-end tax planning because many things can affect your tax rates. Throughout the year, things change: you may earn more or less money, relocate, get a new job, start to collect unemployment, get married or divorced, have kids or even bury a loved one. No one wants pay Uncle Sam too little or too much, and you shouldn't have to. Mid-year tax planning is one way to offset any chance of that happening. Talk to your tax advisor or accountant about any changes that may have an impact on your filing status, tax calculation rules, available deductions and exemptions or tax credits.
Achieve Financial Success
Stop worrying about whether or not you will achieve your financial goals. Financial success is on the horizon when you create and execute a straightforward, simple and doable financial plan. Still feel like personal finance is complicated? Don't worry. Mint.com can help you get a handle on your finances. Sign up today for free.
Princess Clark-Wendel has been recognized in the media as a "National Family Finance Expert," and is helping families throughout the world with strategies for personal finance, savings, college planning, and retirement savings which are easy to implement.