9 Secrets to Taking Back Control of Your Finances

Do you avoid looking at your bank account sometimes? If so, you may be afraid of your money. Now I know that sounds crazy because we're all about the dollar, within reason, but this is definitely a thing. This is the reason why some people don’t use budgeting apps.

Here’s the thing, you can love money and hate it at the same time. You can love having it, but not love making it. You can love spending it, but not love having less of it. You can love putting it in your account, and not love looking at it there.

One thing that a lot of people don't know, is that your attitude towards money can affect you positively or negatively. When you’re afraid of your money, you money controls you, not the other way around. Luckily, even if the thought of your finances makes you uneasy, you can take certain actions that will enable you to take back control.

These secrets will help you get a handle on your finances:

1. Don't be afraid to handle your own bills.

It can be very easy to just let someone take over your finances for you. However, in doing so you would never learn how to handle them yourself. If you're getting someone to help you for convenience, then thats different. Even if you get someone to handle your bills for you, you should ultimately be interested in learning how to do them yourself. Take one day a month to sit down, go over your bills, and pay them. Then change that one day a month to 2 days. I typically sit down and review/edit my budget at least 2 times a week, if not more.

2. Consider getting a consolidation loan.

Part of what makes this all scary is that you may not have the money to pay all the bills you have. I've actually had clients tell me that they didn't review their bills because they didn't have the money to pay them so it made it pointless. If you have a lot of installment loans and credit cards, you may want to consider getting a consolidation loan. This type of loan combines all of your payments so you just make one per month and save money on interest fees.

3. Ensure you're saving money every month.

A good rule of thumb to follow is to save 15% of your salary each month and put it into an account that earns interest. However, if you're just starting out, start with whatever you have and build up to the 15%. Ultimately, you want to be saving at least 20% of your income and investing some of that in stock/bonds, rental properties, or businesses.

4. Consider refinancing your mortgage.

This is a trick that not a lot of people know. If you've been paying on your home for years, and the amount you owe gets to be too much, you can refinance to change your monthly payments. You can also refinance if you want a lower interest rate. These 2 reasons may be able to save thousands of dollars on your mortgage by refinancing. This is particularly true if you intend to stay in your house for years. Do the math to see if refinancing would be advantageous for you.

5. Plan for vacations ahead of time.

Don't be that last minute person, that will cost you. Flights and hotels tend to cost more when you book them last minute; supply vs demand. You should plan for trips by joining travel clubs that can offer you tremendous savings. This can give you much more fun for your money.

6. Make investments wisely.

Investing in your future is good for you and your family. This can be an investment in you knowledge or even an investment of your money. I recommend ensuring that you have an Emergency Fund before you make an actual money investment and before you really understand how to invest. That's where that knowledge comes in.

Seek professional help from a financial advisor if you're unsure which investments would be right for you.

7. Consider getting special accounts for expected expenses and other special events.

My all time favorite, Sinking Funds. Do you always find that you're short on funds during the holidays? Putting away a little bit each month can add up to a lot, when you save consistently. Thats exactly what a Sinking Fund is. You save for an expected expense over time for a predetermined amount.

My Sinking Funds have been a life saver for me. I currently have a Car Fund and a Washer and Dryer Fund. I've had a ton more, but again, those come up and go away very often depending on what they are for and how long you need to save for it.

My Car Fund will never go away because I need that time and time again. I use it for inspections and other repairs that can cost a lot of money. Having a special account for these repairs have definitely lessened the financial blow when I needed to spend money on my car. You should make sure you have some Sinking Funds set up in your budget as well.

8. Understand interest rates and fees on your credit cards.

One thing I hate is a late fee. I pay all my bills on time because I don't like playing with other people's money and I feel that late fees are unnecessary. You should try to make your payments on time to avoid extra fees. See if you can negotiate a lower interest rate with your credit card companies or switch to another credit card.

9. Understand your taxes.

A lot of people love to do their taxes by themselves online, but often don't know what they're doing. They believe they're saving money by not having to pay the cost of the service, but end up losing so much money because it wasn't done properly. If you can't handle your taxes yourself, hire a CPA to assist you. You can also learn how to do them on your own, the correct way. Learning how to do your taxes gives you a tremendous amount of confidence.

Final Thought

Rethinking your finances may take some patience on your part. These secrets will help. Just try one strategy at a time. Once you get used to that strategy, add another. Repeat this routine until you've mastered all 9 secrets. If you need further assistance, don't be afraid to reach out and I can guide you through the details.