Are You Bad with Money? Here’s How to Improve Your Financial Skills

A woman counting money.

If you’re bad with money, don’t worry – you’re not alone. Most people struggle with their finances at some point. The good news is that it’s never too late to learn how to handle your money responsibly. Learning about money management was a standard part of the school curriculum for many generations.

However, that’s mostly fallen out of fashion, and we’re expected just intuitively to know how to manage money in a responsible way. Most of us were never taught about reconciling our checking accounts or finding the best auto loan rates before we were released into the world to fend for ourselves.

You can do a few key things to improve your financial skills. In addition to the tips to improve your financial skills we’ll outline below, consider investing in yourself with a financial education course or two online through your bank or at your local community college.

Tips and Tricks for Financial Stability

Focus on building financial security. This means creating a budget and sticking to it, as well as investing in yourself by taking courses or reading books about personal finance. Without putting in the effort to master these ground-level financial building blocks, you’ll find it challenging to achieve the next steps.

Loan Rates

Ensure you understand the personal, home, and auto loan rates and how to get the best interest options. This will help you save money on your monthly car payments, mortgage, and other loan-related expenses. Use the following steps to ensure you’re finding the best rates.

  • shop around and compare
  • talk to your bank
  • check your credit before applying
  • dispute inaccurate collections claims
  • pay your bills on time
  • work to improve your credit score
  • avoid maxing out your credit limits

Money Smart

Make efforts to be money smart in your everyday life. This means being mindful of spending, tracking expenses, and making wise financial product and service choices. Dozens of apps and banking programs offer services that make it easier to track what you’re spending your money on. It’s easy to overlook a multi-hundred dollar eating-out expense when you’re blowing through your budget one blended macchiato at a time.

Eliminate the Opportunity for Impulse Purchases

One of the best ways to stick to a budget is to eliminate the opportunity for impulse purchases. This means not going shopping when you’re hungry, tired, or angry and avoiding stores known for high-pressure sales tactics. It also means being mindful of what you’re buying and why. If you can’t justify the purchase, don’t buy it.

Another way to avoid impulse buys is to only shop with a set amount of money in your wallet. Carrying cash instead of your debit or credit card can help, too. You’ll be less likely to make unnecessary purchases when your funds run low. Additionally, create a list of items you need before shopping, and stick to it. This will help keep you from buying things on a whim. Many grocery stores offer online ordering and curbside pickup to help you avoid impulse purchases while shopping.

Build an Emergency Fund

Prioritize setting up your emergency expenses fund. This account is used only for emergencies, such as missing work due to injury or illness. Most finance experts suggest setting agh to cover 3-6 months of your expenses. This may seem like it is a daunting task, but you can start small. Begin by setting aside $50 from each paycheck until you have a few hundred dollars. Then, work your way up to saving 10-15% of each paycheck.

While it may be tempting to use this money for other purposes, resist the urge. Remember, this is money set aside for emergencies only. If you find yourself dipping into the fund for non-emergencies, you may need to reevaluate your budget.

Avoid High-Interest Debts

it can be tempting to sign up for that Amazon Credit card or take out a short-term payday loan just to “get by until next week.” However, most people don’t realize that these credit and loan programs are rife with predatory interest rates and collections actions. Avoid these types of loans and debts at all costs. They are the fastest way to dig a debt grave.

If you’re struggling to make ends meet, talk to a financial planner or credit unlearning, create a budget, and may offer other resources, such as debt consolidation programs or referrals to low-cost loans. The best way to improve your financial skills is by learning about personal finance and money management. There are dozens of resources available, both online and offline, and take advantage of these resources to help you get a handle on your finances.

Make a Plan and Stick To It

One of the best advice for improving your financial skills is to make a plan and stick to it. This means creating a budget and following it as closely as possible. It also means setting financial goals and working towards them. If you’re unsure where to start, plenty of resources are available to help you create a budget. You can find budget templates online or in personal finance books. Once you have a budget, review it regularly and make adjustments.

It’s also important to set financial goals. These could be short-term goals, such as saving for a vacation, or long-term goals, such as retirement. Make sure your goals are realistic, and you have a plan for achieving them. Then, work on sticking to your schedule. This may mean sacrificing other areas of your life, but it will be worth it in the end.

Improving your financial skills takes time and effort, but it is possible. By following these tips, you can positively impact your finances. Just remember to be patient and to stick to your plan. With time and effort, you can achieve financial success. If you commit to improving your financial skills, you’ll be on your way to a bright financial future. Just remember to take things one step at a time – and don’t be afraid to ask for help from a professional if you need it.

Diversify Your Revenue Stream

When wrangling your finances under control, additional revenue streams are often necessary to increase your cash flow. Once you’ve cut down everything you can afford to go without, you can build them back into the budget with additional income. Consider a side hustle or passive income stream to supplement your budget.

About Carson Derrow

My name is Carson Derrow I'm an entrepreneur, professional blogger, and marketer from Arkansas. I've been writing for startups and small businesses since 2012. I share the latest business news, tools, resources, and marketing tips to help startups and small businesses to grow their business.