December 21, 2020
Tips to Improve Your Personal Finances in 2021
Enjoy Stress-Free Finances This Year with these Budgeting Tips from Midwest Title Loans in Kansas City
While 2020 left a lot of us with financial strain and stress, 2021 feels like an opportunity to start fresh, set a solid foundation and start good habits. But, talking financials and budgets is overwhelming – and who knows where to start? Budgeting starts with simple foundations, but consistency is key. So take some of these budgeting tips, apply them to your day-to-day, and keep going to stay on top of it. By the end of 2021, you’ll be in much better shape than you started.
Get Familiar With Your Expenses
What are you paying every month? Every 6 months? Each year? Take into account everything that you know you’ll be spending money on – that has a “set” price. Consider rent, utilities, streaming services, insurance, etc. Write it all down so that you’re not surprised when you have a payment come out for an annual service.
Pare everything down to how much it would cost you each paycheck. Do you get paid bi-weekly or monthly? Maybe you get paid weekly. All of your monthly costs would then be split into four. Annual costs would be split into 52 separate “payments”. How do things look? Is it a larger or smaller amount than you imagined?
Now compare what you have coming in v what you have coming out. If you’ve broken everything down this far, you should have a direct comparison of what you’re spending and what you’re making. If you get to this point, and things are looking a little tight, this is your opportunity to evaluate if there’s anything that you can cut. Do you really need Netflix AND Hulu? Could a title loan help you create a bit more of a buffer? Now is the time to evaluate what’s best for your personal finance planning long-term.
Know Your Credit Score
If you don’t know your credit score, you don’t have a good handle on your financial health. Your credit score will be a baseline for whether or not you get loan approval for important purchases like your car or home, but it can also determine eligibility for some jobs who include credit in their background checks. Free credit check services like Experian, Equifax and Transunion will provide you a free update on your credit score several times per year, so that you can raise the flag if you see anything that doesn’t look right. Believe it or not, things that aren’t accurate can show up on and affect your credit score. If you stay on top of checking it regularly, you should be able to confront issues that arise in a timely manner and get them taken care of.
Use Flex Loans or Title Loans in Kansas City to Pay Off High Interest Credit Cards
Paying off all of your debt at once is an unreasonable ask, and usually unattainable – unless you think about taking on title loans! If you have a credit card that has a high interest rate, chances are, your debt is piling up. While all payments must go on, any extra payments or even if you have wiggle room to pay more than the minimum, should go to the debt you have that has the highest interest rate. Sometimes, that doesn’t feel like enough. Looking into a title loan that could help you pay off that large piece of debt in one lump sum, could save you a lot of money in the long-term. Paying off a high-interest debt quickly, will minimize the impact that the interest rate will have on you – and your credit.
Flex loans give you the opportunity to borrow without putting debt on your credit card – with less effect on your credit. A flex loan acts like an open line of credit, so you can get approved, borrow and pay back as needed, much like a credit card. The difference is, credit bureaus don’t have access to your borrow and payment history with Midwest Title Loans like they would with a credit.
Put Aside 10% For Savings
After you’ve figured out what you spend and what you make, take a look and see if you can reasonably set aside 10 percent of your income to a savings account – to be used in case of emergencies. This could be in a savings account, a 401K or even just stashing cash away in a sock drawer. The important thing is that you’re saving. If you’ve outlined your expenses correctly for the year, this savings account can be saved for when your family is in need. Emergency medical expenses, opportunities that you didn’t know would come to you and your family, unexpected car problems. Saving is hard. Sometimes we get side-tracked, emergencies come up, and the holidays are hard on us. But, if you’re consistently putting money back, the hard times will get easier. The key to saving and being prepared in the harder times, is consistency in the better times. Dedicate 10 percent of each paycheck to an emergency-only fund; you’ll not only be creating an emergency account, you’ll create peace of mind for you and your family.
Check In Monthly On Your Spending
One of the best budgeting tips is: Do not let your bank account go for too long without checking in on how things are going. The best way to stay on top of your budget and be consistent, is to settle up every month. Track all of your expenses, put your 10% into savings, and pay all of your bills. Examine each month what you’ve spent and how you’ve spent it, and use that information to set groundwork for the next month. By setting a regular time to examine your personal finance, you’re able to look at bite-sized chunks that can be easier to process and evaluate. At this point, you can make adjustments where needed. Can you put a little more into savings? Can you cut back on ordering take-out? Did you get $15 out of your streaming service this month, or should you cut it off? Maybe you spent too much on to-go lattes, and your money would be better spent on an espresso machine? This is the time to make personal finance decisions and take control of your budget. So set a reminder on your calendar and get ready!
Go Easy On Yourself
Personal budgeting and personal finance planning is hard, especially when you’re starting from square one. You’re not perfect, and neither is your budget. Things happen. Just because you overspent one month, or forgot to add to savings, doesn’t mean your whole financial wellness has gone off the rails. It’s ok! Next month, get back on track. Everyone can have good financial health by practicing consistency and awareness. Give yourself a little grace to make mistakes, learn from them and improve your budgeting and financial wellness for the long run.
If you started the new year in a financial bind, Midwest Title Loans is here to help you get the cash you need fast. Contact us today to get started with our simple lending process.