Whether you’re aware of it or not, you’re already in money management territory every day.
Every decision you make: to buy something now, leave it for next month or not make the purchase at all, to go out today or not, to set up direct debit for those bills or not; it all involves at least a little bit of money management.
The difference is simply that some people do it better than others.
But the good news is you don’t have to be a financial expert to be on top of your money.
You can find room for the things you love even in the tightest of budgets, but that calls for careful money management.
We’ve put together 5 tips to help you hone your money management skills.
The Top 5 Money Management Tips for Millennials:
Automate where you can
You want your money management system to operate like a well-oiled machine. You don’t want to be wasting energy having to log into lots of different bank accounts to make payments for different bills.
The more organized you can be with your money, the more connected you will be with it and this is what matters.
Pay yourself first
Work out your weekly, biweekly or monthly savings goal (in line with your pay cycle). Then take this amount ‘off the market’ as soon as you get paid.
Many people plan to save or invest, but they usually do it with what’s left at the end (if anything). Don’t wait for the end of the month and save just what’s left as it’s too easy to have spent all your money and just say “oh well, next month I’ll do better”.
We suggest having a savings account with a different bank than your everyday spending/checking account. This makes it harder to access that money, and puts a barrier up when you may be feeling a little impulsive.
Withdraw your weekly spending amount in cash
If you find the whole tap and go system makes it hard to keep track of how much you’ve spent each week, consider withdrawing your weekly spending in cash. Use this for your coffees, lunches, dinners, ice cream, etc.
It’s amazing how much you can overspend by just putting everything on the plastic. It also intrinsically hurts a little more having to hand over cash, so you’re definitely more wary of what you spend.
Have a get out of jail account (GOOJ)
We have all had that unexpected expense come up and rurin our savings strategy. Lets just accept that these things are going to happen regularly, so why not plan for these.
The best way to do this is to have an account that has an amount of money in for these exact moments. We call it a get out of jail account because it might save you from going there one day! Ideally you want at least 3 months income so you can handle most situations that come your way.
Use technology to your benefit
Track your spending.
We see it time and time again, millennials spending their entire pay wage but they can’t tell you where it goes. Apps such as Mint or Pocketbook can take the hard work out of budgeting for you by segmenting what you spend and assist with forward planning of expenses and bills. It’s a pretty interesting exercise to see the exact amounts you spend and where.
