Everybody’s busy these days, but are you really too busy to improve your finances?
It’s always important educate yourself about personal finance. However, there are small things you can do today that’ll help you reap rewards as well.
So set aside a couple hours, buckle in, and commit yourself to making positive changes with your money.
How to Improve Your Finances Today
Clean up your credit cards
Having a great credit score will help you get:
- Approved for loans
- Lower interest rates
- Higher limits on your credit cards
- Better car insurance rates
- And more!
I won’t sit here and act like the credit score formula is simple – it’s not. However, I can tell you what the most important criteria are and how you can put yourself in a better position very quickly.
Your credit is scored based on these weighted factors: 35% payment history, 30% amount owed, 15% length of history, 10% new credit, and 10% types of credit used. For payment history, you improve that factor by paying your bills on time. Here’s what you do next.
Ask for higher credit limits
The second factor, amount owed, is more complicated. This takes into account your “utilization ratio” which is how much credit a borrower uses in comparison to their credit limit. Having a low utilization ratio helps your credit score, so asking your credit card company for a higher limit may help your credit score in the long run.
Cancel cards you don’t use
The third factor, length of history, will look at the average age of your accounts and the last time you used them. Ideally, you want old accounts that are being used frequently.
If you have any credit cards that you’re not using (we’ve all gotten suckered into signing up for new cards at the counter for a 10% discount), pay down the balance and cancel them. Keep things simple!
Cut the fat off your bills and monthly subscriptions
Looking at the expenses on your credit and debit cards is no fun. It hurts. But ultimately, you can’t improve your finances if you don’t know where your money’s going.
So go ahead – take a good, hard look. Look to save money by:
- Cancelling monthly subscription services
- Reducing cable, phone, TV, or internet packages
- Shopping for better services and deals and negotiating with your current provider
To that last point, you’d be surprised by the money you can save or the benefits you can get by looking at other options. Your current provider doesn’t want to lose your business and they’ll often have something extra to offer to keep you around.
Refinance your debt
Let’s face it – debt sucks. I started my adult life with more than my fair share of student debt. Even if you’re able to make your monthly payments, it’s a good idea to seek additional options.
Whenever you refinance your debt, you want to make sure you’re not giving up key benefits that you can’t do without. That can come into play with student loans. The benefits of refinancing include lowering your interest rate, monthly payments and total payoff amount. If the situation calls for it, you can also go for a longer payment period.
In a worst-case scenario, you can test the market and stay with your current deal. The juice is worth the squeeze!
Update your budget
If you’ve never made a budget before, I highly suggest you do so. No matter how much money you make, you’ll always be broke if you spend more than you earn!
Take another look at those credit and debit card statements and get a sense for where your money’s being spent. Are you hitting your savings goals? If not, reevaluate your budget and spending habits.
Typically, easy categories to save money on are food, entertainment, and travel. I know it hurts.
Use free personal finance tools
Being responsible isn’t easy. So why not take advantage of free tools?
Mint is a highly popular personal finance tool and it’s one of the best ways to improve your finances. Mint helps you see all your accounts in one place, allowing you to easily:
- Track and analyze your spending
- Organize your bills
- Get money-saving advice
- Create personal finance goals
For someone more interested in investment tools, Personal Capital will track and analyze your investments and 401k. They also have a premium version that will manage your investments for you (for a fee, of course).
Take Control of Your Money
At the end of the day, learning about money is the best way to improve your finances. To learn more about the topics I discussed in this article, check out the Money Master Intro Course today. It takes less than 45 minutes to complete, and best of all, It’s free!
All opinions expressed on this blog are solely those of Home at 30 and are in no way affiliated with any other organization or institution. The purpose of this blog is to give general education and information about investing, wealth, careers, and college; It is not intended to be professional advice.
Author: Josh Ramos
Josh has paid off $130k in student loan debt in 4 years. By founding Home at 30, he wants to help end the student debt crisis by helping students and young professionals make decisions that will reward them for a lifetime.