If you are anything like myself you are in a constant battle between your desire to be a financially sound adult and your desire to live the high life.
I mean, “Hey! You’re young, you’ve got a good paying job, you’ve paid your rent for the month! WHY NOT BOOK THAT TRIP WITH YOUR GIRLFRIENDS? GO AHEAD BUY THE EXPENSIVE PAIR OF SHOES! #whoisgonnastopyou
You should stop you & so should your savings account or lack there of!
Experiences are necessary & splurging is OK but is the 4th pair of red bottoms necessary? (*Wince* Sorry Shoe gawds). A part of growing up is planning for your future. Retirement. Emergency Funds. Investments. Real Estate. The list of things you “should be” spending your discretionary income on is never ending!
I’ve scoured the internet in search of all things a Damsel should know about using her COIN wisely.
5 Questions to #GetYourFinancialLife
1. How much do you bring home each month?
Now that you’re a big girl with a big girl job you probably have some place a large packet with the words “Open Enrollment” and the year printed on the front. Inside this packet are a slew of really vague terms like coinsurance, deductible, premium and “participating physician” this packet should give you an idea of how much you will pay for your medical, dental, vision and voluntary benefits. These deductions as well as local, state & federal taxes sometimes also union fees and/or retirement savings are taken from your base pay BEFORE YOU EVER SEE IT!
A part of understanding your income is knowing how much you make: gross income and how much you take home: net income are TWO SEPARATE NUMBERS! Budgeting with your net income will allow you to keep better track of your money if you’re new to budgeting.
2. How much do you spend?
Now that you’ve got a grasp on how much you bring home, it’s time to tackle how much you spend. If you are anything like myself the answer to this question would be ALL OF IT! And if that’s your truth that’s fine! Now is the perfect time to get a hold of your spending habits & make a change for the better. The goal is to live off less than what you make so that you can live comfortably. *clear throat* I said; The goal is to live off of less than what you make so that you can live comfortably. This is probably the hardest part of money management. Record everything you spend your money on for two weeks then categorize them by wants: life style choices and needs: absolute necessities.
note: your cell phone and internet may go into NEED but things you maintain a subscription for, like cable, Hulu and Netflix would likely go into the wants category.
3. How much does it take to maintain your life?
This is the part of budgeting that always makes my jaw hit the floor when I realize exactly how much money I am throwing away just because of my lifestyle choices. Take a look at the categories of your spending First determine how much it takes to maintain your life. By looking at where you spend you money and separating them into wants and needs. What do you ABSOLUTELY NEED to spend on? (shelter, groceries, transportation, utilities). Next thi
4. How much do you owe? [Tackling Your Student Loan Debt]
This number is the number that to many, is the MOST detrimental to your credit worthiness. If you are unsure of how much you owe one great way to stay on top of it is to pull your credit report annually. Personally I pull mine each year around my 1/2-Birthday (Yes that is a thing! More on that later!) Comb through the report to make sure there are no errors or duplicates. But also read through to fully understand your financial situation. Did you take out student loans? Charge off a credit card from a department store? Have a car note but no clue when you’ll pay it off? This information should all be clarified by reading your credit report.
I also want to stress the importance of making timely payments. If you’re not paying back what you owe responsibly it’s gonna be pretty hard to get a new lender to lend money when it matters most, say like when it’s time to purchase a new vehicle or maybe even your dream home!
If you’re in the Central Pennsylvania Area and in need of a Realtor contact Tracee Carter of Berkshire Hathaway Homesales.
5. What are your financial goals?(hint getting rid of or drastically decreasing #4)
Ideally we should all have goals in each area of our lives and financial goals are just as important, if not more than getting in shape for that dress that’s a little snug. Set aside sometime to Get Your Financial Life
Put on your big gal panties, and really take a look at your financial documents: bills, pay stubs, tax returns, receipts, transaction summer/ledger on your bank statement, even your credit report. Next create a budget where you can live comfortably, reach your financial goals & still ball out … only ball out on a budget!
If you’ve read this far, I am sure you’re ready for some financial freedom. Share this with you fellow Damsels & Dames who also need to #GetTheirFinancialLife!
& as always remember,
Did you scroll to the bottom for the link? Download the Workbook here!