Payday is an exciting day for many people because it means that your bank account will get an extra boost. Many people don't know that what they do right after getting paid can significantly affect the rest of the month. On the road to being financially savvy, many strategies can help you get there, and here are a few:
Put Money In Your Pocket First
On payday, it might be tempting to pay your debt first or focus on bills, but rather than paying off your debts first, it is a good idea to pay yourself first to ensure that you are putting some money towards your goals and then make the payment towards your bills.
The next important thing to do on payday is to go grocery shopping. This can help with meal planning, as opposed to constantly eating out, which can get expensive quickly, so on payday, try to stock up on groceries so that you can make your food for the next two weeks. This will save you a lot of money in the long run.
After you have stocked up on food and set aside funds for yourself, use part of your income to pay your pending bills. Most people choose to pay bills first, but putting aside some money, no matter how small, towards your fund is an excellent habit to develop over time.
Know Where Your Money Is Going
Knowing where your money is going is a great way to stay in control of your income, and it can help you strategize on how to direct your funds better. A great way to track your money is to download an app that you can link to your bank and use to monitor your spending and determine what categories you spent the most on.
Instead of using a card to make most purchases, use cash to pay for many of your staple expenses. Although it is impossible to pay with cash when shopping online, in-person shopping should be an opportunity to buy with money because it can make you significantly more sensitive to how much and how frequently you are spending.
Cancel Recurring Charges
While some subscriptions can be great, monthly subscriptions to streaming services and mobile apps that you don't frequently use can become extremely expensive over time. Take time to review your expenses and cancel subscriptions that you don't actively use every month.
If you're contributing to a retirement plan and a savings account with your account, you can still manage to set aside some funds into other investment accounts with every pay check. A financial advisor can help you develop an investment plan tailored to your lifestyle and help you set yourself up for the foreseeable future.