How to Manage Your Money Effectively

3 min


Managing your money can bring up a lot of emotions in people, from worry, to fear, to satisfaction that it is all done right. If your budget isn’t where you need it to be and you are starting to dip down into the red, then you need to figure out how to manage the money you already have and how to increase your earnings.

While you could figure out how to get free money on cash app, that is going to be a short term solution at best. Instead, you need to sit down and follow some of these steps to get a handle on your finances. 

First, Figure Out Where You Are

The first thing you need to do is figure out your financial situation. Write down all of your monthly income and your monthly expenses, and write down everything no matter how big or small it is. If you spent three dollars on a raffle ticket, write that down. If you got 10 dollars from a relative, write that down. 

Do this for a month, and then tally up the results. Are your incomes and expenses the same, is one bigger than the other? This isn’t meant to scare you or force you to beat yourself up, but instead it is supposed to give you a broad overview of everything that is going on within a given month, as well as show you what could happen next month.

Set Some Money Goals

You don’t need to save for your retirement or save for a large boat in order to have financial goals. You just need to make goals that are going to be meaningful to you, because those are goals you will actively want to save up for. First, consider what is important to you: if you like to travel, then perhaps saving some money for a vacation is a worthy goal.

If you like to go to concerts, then find a concert a couple months out and save for it. Make your goal fun and you will more than likely want to stick to the goal and ensure that you are saving up enough money to get there.

Focus On An Emergency Fund

Emergency funds are becoming rarer and rarer in the world today, because most people can’t even rake up $2,000 dollars during an emergency, much less 3 to 6 months of their expenses. One of the things that you need to do during the process of building a budget is to focus on the emergency fund, because it is something where you will need to place money. 

It might not seem like it at first, but emergencies will happen and having the funding to respond to that emergency without clearing out your savings is going to be a huge weight off of your shoulders.

Try and See Where You Can Cut Costs

There are plenty of little expenses that we don’t think about or take for granted. The three streaming services, the two apps, the fitness studio we joined, and the obscure service you might use once or twice a month. All of these add up, and in order to overcome these small expenses that are draining your bank account, you need to see where you can cut costs.

Do you really need to be paying those streaming services fifty dollars just to watch three shows? Can you break up with your fitness studio if you aren’t going? Do you really need to use that app? Ask yourself these questions and be okay with the answers, and then start cutting costs.

Just be sure to put all that saved money somewhere else each month, and once you start earning a bit more, you might be able to turn some of those expenses back on.

Keep Checking In With Yourself

While most people do a yearly review or even monthly check ins at the start and end of every single month, if you have a really hard time managing money, then you might want to do weekly or even daily check ins where you tally up your expenses and your income, and see what changes need to be made. 

Doing check ins every single day might seem a bit silly, but once you have a firm grasp on your budget, you can lessen the amount of check ins you do and give yourself some more trust with your money. Then you can start spending your money towards those very large goals and start having some real fun with your money.

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Money management doesn’t have to be rocket science, but it does have to be something you are consistent with. That consistency is going to pay off in the long run once you get your budget down pat and can move onto other things.

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