Money is a complicated thing these days. Fortunately, there are some useful strategies to help you manage your money effectively.

Debt piles up quickly, especially if you took out loans to fund your education. Credit cards are easy to get and hard to get out from under. For this reason, it is important to learn basic money management skills.

We are thrown out into the world after high school or college with no real guidance when it comes to finances. Before we even have a chance to establish credit, we ruin it.

If you are dealing with financial woes or just trying to stay out of them, here are some clever ways to manage your money that can help you get in shape.

1. Budget

It is important to set a budget. It’s not the most popular topic. It is much easier to spend your money without thinking. Financial security is much more likely to be found in a budget and intentional spending.Divide your spending up into categories: mortgage/rent, bills, food, gas entertainment, and savings.

These are just suggestions. Your categories may be different. Allocate a certain percentage of your income to each category. That is the amount of money you have to work with.

Don’t steal from other categories, and the money rolls over from one paycheck to the next. If you are paid inconsistently, determine what percentage of your paycheck is required to pay your mortgage or rent according to your lowest pay.

This may be 50-percent. Or, maybe it is 30-percent. It has to pay this important bill no matter what. Determine the rest of your expenses accordingly.

Sometimes you might have to live off or Ramen noodles and hot dogs while other times you are eating steaks every day of the week. This will help you manage your money effectively by only spending the money you make.

2. Strategies

  • Keep track of your spending

When many of us depend on plastic money, it is easy to lose track of your spending. Many times, you swipe your card without really paying attention to the total. Do you know how much you spend on eating out or on gas? There are many apps available to help you track your spending.

You can also keep a small notebook and pen with you. Make a deliberate effort to write down every dollar spent. You will be surprised to see where your money goes. You will manage what you measure.

  • Have an emergency savings account

This account doesn’t necessarily have to be a savings account, but it does need to be separate from your personal checking account. Most of us pay bills first, then spend, and put money in savings last. You should work towards having at least living expenses for three months stashed away for an emergency.

This can be accomplished using percentages. Determine what percent of each paycheck you are going to put aside. When you receive your check, immediately put that money aside before you do anything else. This is non-negotiable.

  • Shop around

Many times, you can find a service for cheaper if you take the time to shop around. Set some time aside to look several different local insurance agencies and what policies they have available.

You might even request a special set of policies that fit your specific needs. Do the same for cable, phone and internet services.

3. Debt

If you are in debt, paying it off needs to be your top priority. Cut expenses where you can. Downsize your home. Get a second job. Do whatever it takes. Throw all of your extra money at this debt until it is eliminated.

You will feel so much freer once you are relinquished from these payments. Do whatever is necessary to stay out of debt in the future.

Personal finances can be hard to deal with, especially when you are young. It sometimes seems like you are supposed to know how to manage your money with little help from the outside world.

Take the time to create a strategy and a budget. You won’t regret it.

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