Suggestions for managing your money

1.      Distinguish “wants” from “needs.” Be mindful of how you spend your money. Food, shelter and basic clothing are needs. All other choices are wants.

2.      Discipline your spending. When you go to the mall, decide what you need, buy it and leave. This will save time as well as money. Browsing leads to impulse spending – those merchandisers are smarter than you are!

3.      Pay yourself first. Take 10% of your paycheck and immediately put it into your savings. Don’t let it even touch your fingers. You’ll notice two things: 1) it starts to add up quickly, and 2) if you park it before you ever see it, you don’t miss it.

4.      Pay off debt as quickly as possible.  As my father taught me, “interest will kill you.” Pay off high interest debts first (especially credit cards). Next, get rid of debts that are not tax-deductible. Carry only one or two credit cards – cut up all others. Pay off your credit card balance in full each month. Otherwise, pay cash.

5.      Track your spending for a few months to see where your money’s going. Write down everything you spend. You may be shocked to see that your daily soup and sandwich at lunch costs $35 a week and forgetting to return a video costs $5 a pop. It all adds up.

6.      Live within your means – based on your after tax (net) income.

7.      If you’re having problems managing your money, seek professional help. Most communities have consumer credit counseling services available.

It’s time to take control of your money and be mindful of how you use it. Then the Law of Rotating Bankruptcy will no longer apply to you.