For most of us, our twenties are the first time we’ve really ever had to manage our own money. It’s one of those real life skills you don’t learn in college, but rather have to figure out for yourself. Many of us don’t really take it seriously until we have to. With New Year’s resolutions on the mind, why not rethink the way you manage your finances as well? I’ll make it easy for you. Just follow these five steps:
1. Sign up for an online money management tool.
Why reinvent the wheel when there are already money management tools out there? Start by creating an account on Mint, my go-to finance app (it’s FREE!). They make it incredibly easy to get started and to link your other accounts so everything is in one place. They even help you budget, save, pay your bills on time, and more. Being able to see your finances in a clean, easy-to-use interface makes the process a lot less daunting.
2. Calculate your monthly cost of living.
Once you’ve created an account with a money management tool, the next step will really open your eyes to the reality of your finances. Calculating the exact amount you spend each month is essential in order to get a better understanding of your finances. When I sat down and did this, it finally felt like I was taking control of my finances, which is a great feeling. This amount includes all those monthly expenses like rent, cable, food, pilates, haircuts, shopping — everything that you consistently spend your money on. From there, you can compare what you spend each month to what you make and adjust accordingly....