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Let’s make these money moves so that you can create wealth. This article will help you guide you on how to start managing your finances. The key is to start small. Consider where your money goes. Every dollar needs a home on your money journey every month.
Budgeting sucks, why should I spend the time?
Because without knowing where your money goes, it is hard to build wealth i.e. save and invest. You’ve got to plan to save or you never will. It has happened to me - money came in and before I knew it, it was all gone. No goodbye. Also, budgeting or tracking your money is easier now than ever.
Ok, ok, so how do I make these money moves?
You can link all of your accounts to a digital app and simply check it once a month. Some people use the envelope method, others use physical paper, spreadsheets or apps to track their spending. I use a few different apps like Personal Capital and Mint to manage my spending and track my net worth. Once you have an idea of how you spend your money, you can figure out where you can cut expenses. All money that is cut should go to your savings or investment account. Even $2 saved this year is $2 more than you had before; future you will thank you! You should identify buckets: core expenses (must-haves like rent/mortgage, utilities), luxury expenses (nice-to-have spending), savings (income minus expenses). Ideally, savings should be positive 😉 otherwise you’re blowing through money you don’t have in hand yet.
Personal Capital vs Mint
Both:
- Show net worth
- Allow drilling down of expenses and income
- Track net worth and tally debt.
Mint:
- Easier to reliably sync to multiple accounts (fewer errors)
- more ads
- Great visuals for budgeting breakdown so you can easily tell which categories that you have maxed out,
- Shows surprise expenses or subscription cost increases
- Gives bill reminders & spending alerts
Personal Capital:
- Allows monthly cash flow breakdowns (really love this)
- Retirement Planner tool that help you assess your chances of retirement success
- Recommended portfolio for you based on your risk preference, target retirement date and projected income sources.
- Weekly newsletter with current events and your investment performance
- Fee Analyzer helps you unearth hidden fees charged for investments
TL;DR
Mint is great for folks who are interested in budgeting while Personal Capital is great for those who want a closer look at their investments and more retirement guidance.
QWC regularly uses both of these apps and has done so for years as they are both very secure. We believe in the value that they provide. If you are interested, sign up for Personal Capital and Mint for free.
Take stock of any debts that you may have and start to pay the debt off little by little. We suggest tackling the debt with the highest interest first. Paying off your debt should be top priority as it will truly allow your net worth to grow. Credit cards and student loans can have interest rates as high as 7%. Paying these debts off puts that 7% back in your pocket automatically.
Once you have 3-6 months’ worth of living expenses in a high yield savings account, and any debt paid off, then you can start investing the amount that you save every month instead. Marcus by Goldman Sachs offers an online high yield savings account and you could earn an additional 0.50% Annual Percentage Yield (APY) - double their current APY - for 3 months if you sign up here. It only takes 10 minutes!
You must know where every dollar goes. Every dollar, pound or lira has a home when it leaves your pay/income check to be ‘spent’, which could mean going to your savings account or to be physically spent on groceries. Now, you can make your big money moves with confidence!