In uncertain economic times, many people find themselves struggling with their personal finances. It can be difficult to know how to properly manage your money even in the best of times, and when times are tough, doing so is even more difficult. Fortunately, there are some proven ways to take control of your finances so that you do not end up struggling with debt. Use the following tips to take charge of your money and help yourself achieve financial security.
Another important tip is to keep the percentage of available credit card funds you borrow to a minimum, ideally not more than 30 percent of your available credit. When lenders look at your credit to determine your worthiness for a large loan, such as a mortgage or car payment, they will look at your debt to available credit ratio as a determining factor. If you are maxed out on all your credit cards, it will look bad and can cause you to be turned down for a loan. At the very least, it will often cause the lenders to offer you a higher interest rate which means more money out of pocket.
A sound budget is one of the most important tools you can have in managing your personal finances. By tracking all of the money that comes into and goes out of your home, you will have a much better sense of where you stand. Write down all of your expenses, starting with necessities such as rent, utility bills, and debt payments. Try to set aside some money each month to go into savings, and put some into an emergency fund which you leave untouched.
One of the biggest expenses that people have is the automobile. Cars are expensive on their own, but when you consider how much fuel costs, they become even more expensive. If you can, try carpooling with a friend to save money. When you carpool, you and your friends or coworkers call all share the same car and avoid paying for fuel for each of your vehicles. You all can alternate vehicles so one person isn't left doing all of the driving. Alternatively, you can also use public transportation, such as buses and trains. The price to use these vehicles is far less than the cost of filling up a gas tank. If you plan to travel a short distance, you can try walking, cycling, or skating if you own a bike or roller skates. These forms of transportation ensure that you don't have to pay for fuel at all.
Often people will subscribe to services that are costly, such as cable television and gym memberships. These services are not needed, as there are cheaper alternatives. For cable, there are free websites, such as Hulu, as well as paid sites and services, such as Netflix, that let you watch much of the same content for far less. If you must have cable, then go for one of the cheaper plans that includes only the channels you frequently watch, and skip the movie channels in favor of a low cost streaming site or a cheap one time rental service, like Redbox. As for gym memberships, there are plenty of exercise videos and guides readily available for free on the internet. There are even some that don't require you to spend money on exercise equipment. You can turn your own home into the gym and make your own schedule.
Credit cards can be financial assets when they are used correctly, and they can also have a very negative impact on your financial future. Take the time to learn about your cards and use them wisely. This protects your credit and keeps your life free from financial stress.
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