Having financial concerns is very common, especially with the current state of the economy. Everyone has anxiety regarding the cost of living, how much they are earning, and whether they are saving enough for retirement.
One way to alleviate your financial anxiety is to take charge of your circumstances, such as setting up an OANDA login and trading forex. While some people may be willing to day trade to boost their income, others may want to better use the money they are already making through their jobs and investments.
Below are the five most helpful and effortless money management tips that you can incorporate into your lifestyle in 2023 and beyond.
1. Create a Budget
The first step to better managing your money is to create a budget that fits your present needs and circumstances. Make a list of all your expenses in a given month, which should include rent, utilities, food, entertainment, and any debt repayments.
Then compare your expenses with income. Are you bringing in more money than you spend each month? If the difference between the two is not to your liking, then you may have to think about making changes to how much you are spending.
Even if you cut back on your expenses in one or two areas, such as eating out or vacationing, you can comfortably stay within a budget and improve your financial circumstances.
This may also show you that you are spending too much on things such as Instacart Costco Same-Day delivery which is more expensive than 2 day delivery.
2. Assess Long-Term Investments
There is a tendency for people to think that they need to completely transform how they are investing their money if there are economic concerns. While issues such as inflation and a looming recession are very real, you must differentiate between short and long-term investments.
If you are already investing your money in long-term stocks, bonds, mutual funds, or other commodities, you do not necessarily need to rethink those investments. So long as you have a savings nest egg and those investments are in stable companies with a long history of success, you are in good shape.
Even if your long-term investments do decline in value slightly over the next year or two, you are safe. These are investments you plan to cash out in 10, 20, or 30 years, not immediately. Short-term losses are acceptable when you are playing a long-term game.
3. Pay Off Debt
One of the consequences of the present economic climate in the United States is a rise in interest rates. Given the Fed is attempting to curb inflation through its economic powers, the result is that most banks and financial institutions are charging higher interest rates for loans.
If you have any debt that involves a flexible interest rate, which can change periodically, you may want to drive down that debt as much as possible. Pay off your loans that have the highest interest rate, or consider refinancing to a loan that has lower interest.
Even if you must slightly reduce your savings to pay off some debt, you will be in a better position in the long term. Saving money on interest expenses is very important, especially if those rates are set to rise over the coming months.
4. Improve Your Credit Score
Aside from the economic outlook, another factor that impacts interest rates on personal loans is your credit score. If you are planning to refinance loans or hope to buy a house in the coming years, improving your score is a very effective money management strategy.
Having a higher credit score gives you access to better credit terms. There are countless purchases you would be able to complete using 0% APR monthly installments rather than having to pay for these items upfront.
Ways to improve your credit score include paying off any debt that has gone to collections, lowering your borrowing percentage on your existing credit cards, and avoiding taking out too many new credit cards in quick succession.
5. Watch Out For Short-Term Investments
Even if you are strategically planning your finances with a long-term outlook, you should always be open to short-term investment opportunities. Set aside a small percentage of your savings for these ventures, such as investing in stocks or real estate that may be available for an appealing price.
For instance, you may notice a house or commercial property in your area that is seized by a bank for nonpayment, which would eventually lead to the property being sold at a knockdown price. Perhaps there is a sector of the economy that will boom in 2023. You could invest in stocks of prominent companies in that sector.
