Old habits die hard, and that should especially be the case for bad money habits. If you’re finding yourself with little-to-no savings and spending more money than you earn, then it’s time to ditch your bad money habits and work on building new money habits.
By building good money habits, you’ll be well on your way to gaining (or re-gaining) confidence in your everyday financial life. Good money habits help you budget, save money and pad your sinking funds, and work towards your most important financial goals, whether that’s your next hot and sunny destination or working towards early retirement.
Sure, Rome wasn’t built in a day, and building good money habits (while dropping the bad ones) and improving your financial fitness isn’t something that usually happens overnight. But that doesn’t mean you can’t get started right away. Below are 13 easy, no-effort, and effective money habits that you can get started with right away.
Money habit #1: Automate your savings
Automating your weekly, bi-weekly, or even monthly savings contributions is what’s known as “paying yourself first” and is one of the best ways to make sure that you are consistently contributing towards your short-term savings, investments, and retirement funds. without having to worry about making manual contributions yourself.
By doing this, you’re eliminating both the time and the work that is involved, while making sure that you are always working towards your financial goals.
P.S. Saving for a family trip, vacation with friends, home repairs, or birthday celebrations? Frugl makes it easy to automate saving for what’s important to you.
Money habit #2: Automate your bills
Automating what’s coming out of your accounts is equally as important. By automating your regularly occurring bills such as rent, utilities, and cell phone payments, you’re making sure that your bills are being paid on time, which means you don’t have to worry about missed payments, late payment fees, or interest.
The other benefit is this; paying your bills on time is a sure way to build your credit score.
Money habit #3: Set a phone reminder to check your bank account once a week
Regularly checking your bank accounts is a small but mighty habit that can give you a clear view of what’s taking place in your accounts; the good, the bad, and the ugly… well, hopefully just the good!
By quickly checking in once a week, you’ll be making sure everything adds up and that you’re not being charged for payments you actually didn’t make! It’s also a good way to know exactly when money is coming in and when payments are going out.
Money habit #4: Create a separate savings account for an upcoming big purchase, like a vacation!
Opening separate savings accounts are more than just a good idea; it’s a game-changer. When you create separate savings accounts for each of the different savings goals you have, you’ll reap many benefits including easier automation per account; easier goal tracking; increased motivation; and reducing your chances of easily misspending any money that’s pooled together.
With Frugl, you can create separate, individual savings accounts for your goals in less than two minutes! Give it a try today
Money habit #5: Treat that ‘extra’ money with extra respect
The next time you get a raise, have a great month with your side hustles or net that bonus you’ve been waiting for, do yourself a huge favor, and don’t go spending it all at once. Instead, take most or all of that ‘extra money’ and put it toward your savings goals.
We’re not saying it’s going to be easy, but it’s absolutely going to be worth it in the long run. Remember, a dollar saved is a dollar earned.
Money habit #6: Chat openly about your money
Open and honest money conversations with friends and family is a great way to learn new money management approaches and money tips to improve your literacy.
It’s also one of the best ways to get over any of your money fears and to help you take those next steps to start working on your financial goals.
Money habit #7: Use the Honey Chrome extension when shopping online
What if we told you there was an app, or rather a Chrome extension, that automatically looks for discount and coupon codes for you when you’re window shopping online? Well, there is and it’s called Honey.
Getting started with Honey couldn’t be easier; Add the chrome extension and as you browse websites like you normally would window shopping online, Honey will automatically find working discount codes for you and apply the one with the biggest savings to your cart.
It might be worth mentioning that we ONLY recommend using this when you’re already committed to making a purchase.
Money habit #8: Skip eating out once a week
Guilty of eating out and splurging on lunches or dinners throughout the week? You could easily be wasting thousands of dollars each year. Even those small $5 to $10 food splurges here and there can add up and impact your ability to save for what’s important to you.
Would you rather Mexican takeout on a Tuesday or actually eating authentic Mexican cuisine while in Mexico? I’ll go with the latter, thanks.
Money habit #9: Don’t settle on the first quote you get
Taking the time to do your “research” and shop around for just about anything from everyday household items to financial products and services like auto insurance can pay dividends in the long run.
The best part is that by spending anywhere from thirty minutes to a few hours, you’ll easily save yourself well over a few hundred dollars, as well as have more confidence in your purchase.
Don’t settle on the first quote or price you see. There’s almost always a better price that exists.
Money habit #10: Use Value-Based Spending to guide your spending habits
Instead of spending with emotion or on impulse, use what’s known as value-based spending to help guide your spending habits. The premise is simple, only spend on items and expenses that bring value to you and that reinforce your financial goals. Anything else, it probably isn’t worth it.
Value-Based Spending means that every dollar you spend should add significant value to your life and go towards helping you reach your financial goals.
Money habit #11: Remove yourself from email lists
Out of sight, out of mind. Removing yourself from email lists is all about getting rid of the daily spending temptations that take over your inbox and do nothing but encourage you to spend your hard-earned money.
Money habit #12: Create 3 SMART financial goals
Without setting financial goals, it’s almost next to impossible to track progress and celebrate milestones. When you’re considering your goals, it’s important to create everyone’s favorite acronym, S.M.A.R.T goals, which stands for Specific, Measurable, Achievable, Relevant (or Realistic), and Timely.
Make sure to set both short-term and long-term goals to keep you motivated while focused on working towards your financial future.
Money habit #13: Sign up for mobile alerts from your bank
Long gone are the days of having to wait for bank statements or account updates to know what’s going on inside your bank account. With bank alerts, you can get real-time updates about various types of account activity and use these alerts to better manage your finances.
While the types of alerts available vary from bank to bank, they’re usually free, and you can choose to receive them by email or text.
Out with the old, in with the new
Say goodbye to your bad money habits and hello to these 13 new easy, no-effort, and effective money habits that will help you save more money, reach your goals, and feel better about your relationship with money. Which one will you be taking up first?