1. Ration Out Any Suprising Income
Use the rule of thirds to decide how to use a bonus, gift, or extra cash that you recieve. One third for the past: Use this third to pay back any money you owe or debt you still need to pay. One third for the future: use your time wisely and as soon as possible, put this third into a savings account. One third for the present: use this third to buy and do whatever you want, improve your home, buy new clothes or makeup, go on a trip, etc. If you follow the rule of thirds, you will quickly see your savings increase, your debt decrease, and you will feel better about your financial situation.
2. Keep An Emergency Stash Handy
Always, things will pop up that will totally mess up your monthly budget, whether it be a leaky roof, a burst pipe, an emergency doctors visit. It happens. To keep these events from hurting you financially, you need to have an emergency cash stash in an easy account to access. A money market account would be ideal for this stash because they earn a little more interest than your average savings accounts.
3. Ditch the ATM Card
We are always makng stupid purchases, wheter it be a candy bar at a gas station or that new movie that just came out on DVD. How can you stop your account from draining? Take a hint for our elders and just ditch the ATM card altogether. Instead of the card, think about how much cash you will need for your regular week, and head on over to the bank and get your money for the week ahead. With that week-based amount of cash you will be forced to think wether that candy bar is worth it or not.
4. Place Yourself On Your Personal Payroll
Every month, the time comes around where you have to sit down and write out all of the checks for your growing amount of bills. After writing all of the checks, you need to write one more: to yourself. A longtime financial planner based in Monroe, New Jersey, Jay Fine, offers an easy way to put your retirement planning on a roll. "Put yourself on the payroll," he says. "Every month, or even better, every paycheck, make sure you set an amount aside for investment. A good number would be about 6%. Anything more would be great. If you have to, you can even write yourself a check to deposit or send to another account. But just as you pay your mortgage and you electric bill without fail, now you'll be making sure to pay yourself as well."