Jumpstart Your Personal Finances

jumpstart your personal finances

Welcome to 'generation debt'! It is hard to find anybody these days that is not in some form of debt. Be it student loans, credit card debts, overdrafts or mortgage repayments. The large majority of people are struggling to get themselves out of the red and into the black.

Today’s post will give you some key tips on how to jumpstart your personal finances, save money and avoid becoming another statistic. Or at the very least help you escape what debt you already find yourself in.

Key Tips On How To Jumpstart Your Personal Finances

Be smart and always ask yourself "do I need this?" before you buy anything. It is important to distinguish between wanting something and needing something.

It is alright to treat yourself occasionally but do not waste money you barely have. The key is to budget and not become somebody who carelessly spends money without assessing the repercussions.

While many people have multiple bank accounts, you should have at least two accounts. A checking account and a savings account.

A great tip that everybody should use is the 10% rule. Pay yourself first, be it weekly or monthly you should put 10% of your wages into your savings account.

Pay attention to the interest rates in your savings account and watch your money grow. Do not touch this money unless absolutely necessary, and should the worst happen you will know you have money to get by on for a little while at least.

The first thing you do with your income is pay for essentials, such as any bills you have, rent, mortgage payments, groceries, clothing you may need, basics around the house etc. Once you have paid for everything you need you can think about buying something you want.

Once you have put 10% of your wages into your savings account and have paid for your essentials you can treat yourself.

However if you really want to jumpstart your personal finances you need to be smart about how you spend money on even the little things.

A muffin every morning from the local cafe will add up, as will eating out at a restaurant each evening.

Why not just make muffins at home and take one with you in the morning, and cook yourself dinner at night?

You do not have to live on the bare minimum but do not be lavish either.

If you jumpstart your personal finances now there is plenty of time to treat yourself in the future once your finances are on a strong foundation.

Plastic Money - Credit Cards

organize your financesWe live in the era of plastic money - credit cards are incredibly attractive to most people. You can buy what you want now and worry about paying for it later.

There is nothing wrong with using credit cards if you follow some very easy rules.

You should try to only use a credit card when you know you will be able to pay off the entire balance before you incur any charges. If you do not have the money then do not spend the money! It really is that simple.

If you find yourself needing to use your credit card for an emergency then pay attention to the interest rates.

If you fail to pay off the entire balance in time this percentage will be added to the bill and it can very easily get to the stage where you can barely afford to pay off the minimum amount each month meaning the initial amount remains and you are not even putting a dent in it.

If you find yourself in a situation where you are unable to pay off the entire amount in time, at least pay off as much as possible so the money you throw away in interest is lessened and you start to chop the overall amount down in size.

A great way to pinpoint areas you are wasting your money on is to take note of everything you buy for a couple of weeks.

At the end of this time add everything up and notice the things you are spending money on that are truly unnecessary.

It is easy to jumpstart your personal finances if you follow these few simple tips:

  • make a budget and stick to it
  • do not live outside your means
  • pay yourself first to build up a healthy savings account before you decide it is time for a treat
  • make sure you have the essential expenses covered and try to cut down on any wastage in your day to day spending
  • pay attention to the interest rates in your savings account and on your credit cards to make sure you are getting the most for your money and not wasting anything

Saving money is not something reserved for older people. If you start now you will reap the rewards soon enough. Take it from somebody who knows, there is nothing more crushing than the feeling of unaffordable debts. Jumpstart your personal finances now and secure a less anxious future.


    • AverageJoe

      AverageJoe 01/16/2013 6:42 a.m. #

      I found that cooking for myself was a chore and eating out was a drag UNTIL I decided to start experimenting in the kitchen. Now I play music and usually have a glass of wine while I'm cooking. It's so fun, I easily prefer it to going out to eat.

      • Sicorra

        Sicorra 01/16/2013 10:14 a.m. #

        With the wine and with cooking in the kitchen you remind me of the Galloping Gourmet. Please don't say you are too young to remember him...

    • Pauline

      Pauline 01/16/2013 6:44 a.m. #

      Not wasting is my favorite. People sometimes keep big amounts in a savings account that brings almost zero interest while paying 20% in debt. An emergency fund is a must but once that is out of the way the focus should be on expensive debt.

      • Sicorra

        Sicorra 01/16/2013 10:16 a.m. #

        It is a shame that savings accounts these days pay such low interest. I will never forget making 22% interest on my savings account and loving it.

      • Marissa @thirtysixmonths

        Marissa @thirtysixmonths 01/16/2013 11:56 p.m. #

        My thoughts exactly! I never understand why people keep that much in low interest accounts.

    • DC @ Young Adult Money

      DC @ Young Adult Money 01/16/2013 6:44 a.m. #

      I definitely agree with you about putting some money away in savings. Just last night my wife and I were making a plan on how to start saving more consistently. I think starting small is key. If you aren't ready to put 10% in, start with 5%. Start with something! With our savings account we hope to "never touch it" which may be unrealistic but we don't want it to be something we think we can spend.

      • Sicorra

        Sicorra 01/16/2013 10:17 a.m. #

        It is so good that you are starting your savings when you are young. I think when people make something a habit it hopefully lasts forever.

    • Catherine

      Catherine 01/16/2013 6:46 a.m. #

      Great post Siccora. I struggle with the pay yourself first rule. I really need to get better at saving!

      • Sicorra

        Sicorra 01/16/2013 10:18 a.m. #

        Pay yourself first can mean a variety of things too, but starting is the hardest part.

    • John S @ Frugal Rules

      John S @ Frugal Rules 01/16/2013 7:01 a.m. #

      Good post Sicorra! We often ask ourselves if we really need something before we buy it and often times we don't. I think a lot of times it comes down to delaying that gratification in order to avoid overspending.

      • Sicorra

        Sicorra 01/16/2013 10:19 a.m. #

        But what if you really need something (not something fun) but a necessity and you still can't spend the money. Unfortunately many people are in that situation.

    • Debt Roundup

      Debt Roundup 01/16/2013 7:53 a.m. #

      I know use my credit cards as a rewards mechanism. It also makes it easy for me to see what I am spending in just one area because I put everything on my credit card and then pay it off each month. It provides a great way to keep your money secure and gain rewards.

      • Sicorra

        Sicorra 01/16/2013 10:21 a.m. #

        Reward cards have become so popular in the last few years. A good way to entice people to use them. And then some manage the repayments well, like you, and some don't, and that is what the bank is hoping for.

    • Shannon @ The Heavy Purse

      Shannon @ The Heavy Purse 01/16/2013 1:06 p.m. #

      Great post, Sicorra! Being financially responsible isn't always "sexy" but being in debt isn't glamorous either! I'm so glad you talked about paying your essentials first - this is something that most people - especially young people - don't think about. When I find things I want, but don't really need, I always ask myself - do I love this? Or do I love going on vacation with my family more? You can guess which one wins - and helps me not feel deprived when I leave the store empty-handed but with a full heart.

      • Sicorra

        Sicorra 01/16/2013 1:20 p.m. #

        Your point shows how it all comes back to what our priorities are. A new sweater or a family vacation? A new hugest TV or feeling secure because there is money in the bank?

        Many of us do not deal with our finances that way and that is why we get into trouble, or maybe not into trouble, but many times, we are not as happy as we could be if we had thought about what we really want.

    • krantcents

      krantcents 01/16/2013 3:20 p.m. #

      Good points! Going through the budget process will point out where you overspend. Hopefully, make you reign it in. I always start with savings and adjust everything else to fit. Savings is a priority for me.

      • Sicorra

        Sicorra 01/16/2013 7:02 p.m. #

        Once you get all the numbers down in black and white it is somewhat easier to take control of your spending.

    • Brian @frugallyminded.com

      Brian @frugallyminded.com 01/16/2013 5:50 p.m. #

      Great advice. Sometimes you'll be surprised at how much you can save by doing little things (like brewing your own coffee instead of going to starbucks).

      • Sicorra

        Sicorra 01/16/2013 7:03 p.m. #

        Right, coffee, bottled water, a cookie, it all adds up.

    • Corina Ramos

      Corina Ramos 01/16/2013 7:15 p.m. #

      Awesome tips Sicorra. When I started working from home our spending went from buying the things we needed rather than what we wanted. But we put a little savings plan that we could manage it's helped us save money and manage our money better.

      You make a great point about credit cards. Part of our cutting back plan included getting rid of credit cards. We kept two for emergencies and only use it once a month on something like filling up our cars that way it's easier to pay off the balance plus we're building up credit.

      One thing we do for "mad" money is save our change. I have a 64oz pickle jar and we put our change in there. When we fill it up, we cash it out and use that to buy something frivolous without the guilt and without touching our budget/savings.

      Great post Lady...thanks for sharing this with us.

      • Sicorra

        Sicorra 01/17/2013 9:56 a.m. #

        Thanks Corina! We've always done the change thing as well. I rolled a bunch of coins last year and took them to the bank. We also pay a deposit on milk cartons and stuff, so once in a while we cash those in and get enough for one more jug of milk :-) Whooo hooo..

    • Brick by Brick Investing

      Brick by Brick Investing 01/17/2013 7:38 p.m. #

      We are definitely the generation debt. This day and age nobody teaches us about personal finance other than the household we were raised in. I can say from personal experience I didn't receive anymore than the basics of personal finance in my household. Therefore everything I learned was on my own either through books or failure. Hopefully we can implement some sort of personal finance in our schools in the near future.

      • Sicorra

        Sicorra 01/19/2013 9:52 a.m. #

        My situation was pretty close to yours. Looking back I guess my parents thought they were teaching by example, and although my father spoke to me a few times about the importance of saving money, once I started making money, I didn't really follow his teachings all that well.

    • Laurie

      Laurie 01/19/2013 4:18 a.m. #

      Sicorra, great post! And you are SO right about the little things, like that daily muffin, adding up to big numbers. In our case, it was purely the little things that got us into BIG debt. They can add up fast and furiously without us even realizing it if we're not tracking our expenses daily.

      • Sicorra

        Sicorra 01/19/2013 9:53 a.m. #

        When we don't pay attention they can definitely add up quickly. I use to spend so much on that kind of stuff when I worked in the corporate world.

    • David

      David 01/20/2013 6 p.m. #

      Hi Sicorra, These are useful recommendations. Debt is unavoidable but if we take care of our personal finances, then it is easy to cope with debt issues.

    • KK @ Student Debt Survivor

      KK @ Student Debt Survivor 01/20/2013 7:59 p.m. #

      Bf saves us several dollars a day not going to starbucks. Since he bought a fancy coffee maker, he's been making coffee at home and taking it with him to work. Sounds trivial, but all those coffees add up.

    • Andrew

      Andrew 01/23/2013 5:42 p.m. #

      Great tips on how to handle personal expenditures. I pay myself first at least 15% of my earnings. Afterwards, the rest of the money goes to disposable income.

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