Saving can be hard to do. There are so many new products out there and they all cost a lot of money. It is hard for some people to keep money in their pocket. These are 5 tips for creating financial discipline with money.
It is easier to accomplish something if goals are set. A person should write down that they are looking to accomplish and in the time period they want to get it done in. For example a person can say that they want to purchase a home that costs around $200,000 and put 5 percent down. They want to have enough money to do this within a year. This will help a person realize how much money they need to save each month in order to reach this goal. This will help keep money in the bank and reduce spending on items that are not needed.
2 Separate Paychecks:
If a person gets paid they often say that they want to put money into a savings account. While this is a good idea it rarely happens. There is a simple solution for this. The payroll department can put a certain amount of a certain percentage of each paycheck right into the savings account. This way a person does not see the money and they are not tempted to spend it.
When a person is out shopping and they do not have enough cash to purchase an item they want, they may use their credit card. In order to build up discipline leave the credit cards at home. This way a person is not tempted to use them. When paying with credit it is easy to feel like no money is being spent. Having the credit cards out of sight and out of mind will help control spending.
4 Delay Purchases:
When a person sees something they want they may want to purchase it right away. Instead of buying this item take some time to think about it. Wait a week or more and then see if the item is still as appealing as it was the first day. This will help a person realize they do not really need something and will help keep them from spending and wasting money.
5 Develop a Budget:
Setting a budget will help a person see where their money is going and will help them develop discipline with money. A person will make sure their bills are paid. They will also see the areas where they are spending too much. This will help a person develop a plan for their money and make adjustments as needed. Many people do not realize the price they are actually paying for things and a budget can help them realize this.
These are some tips to help a person learn how to become disciplined with money. While money can still be spent on fun items from to time, discipline will allow a person to develop a savings and see where they are spending their money.
Having good credit is important to make larger purchases. Bad credit can happen to good people. Paying a couple of bills late can drop a credit score by hundreds of points. Here are 7 ways to improve your credit score and get back on track to having good credit.
1 Keep Balances Low:
Your credit score can be affected by how often you use your credit cards and how much money you are charging. It is recommended to keep your balances below 30 percent of your credit limit. Even if you are paying your balances in full but are charging a large amount of money it can have a negative effect on your credit score. To help keep the balances low see if the credit card company will accept several smaller payments throughout the month.
2 Pay off the Balance:
In addition to keeping balances low it is best to pay off the balances on the credit cards. Start with the cards with smaller balances. After doing this work on paying the balance on other credit cards down.
3 Old Debt is Okay:
Many people feel that old debt on their credit report is a bad thing. This is not the case. Negative items will be removed from the credit report after a 7 year period. Paying off larger items such as a home or a car can be left on the credit report. This shows that you have a history of paying off your debt and you can be counted on to make the payments.
4 Applying for Credit Too Soon:
When shopping around for the best rates for car loans or even home loans in a short period of time this can cause your credit score to drop. This is due to the fact that you are looking for additional credit to use. There are some ways to tell if you are getting a good rate without hurting your credit score. Some lenders ignore credit inquiries that are made within 30 days of scoring. After this time period the inquires that you requested will be counted as one inquiry.
5 Pay Bills on Time:
One of the easiest ways to improve your credit score is to pay your bills on time. Even if you are only paying the minimum amount make sure you pay it on time. If a collection agency is called because you are not paying your bills or paying them late this can have a negative effect on your credit score.
6 Use Credit Wisely:
If you are taking cash advances on your credit card or decreasing your monthly payment you can hurt your credit score. To improve your credit score keep payments consistent. Sudden changes in credit usage can make you a risk to credit card companies.
7 Do Not Get Worked Up:
Improving your credit score is simple. All you need to do is pay your bills on time and use credit wisely. Do not make large purchases or purchase things that you do not need.
You can get your credit report free of change once a year. Be sure to keep on top on your credit especially if you are looking to make large purchases.