12 Top personal finance tips to boost your earning potential

Isola Moses | ConsumerConnect

In view of the need to ramp up your earning potential as the economy is gradually bouncing back, following several months of COVID-19 lockdowns, there is no better time than now to apply these nuggets of financial wisdom, courtesy of LearnVest, a leading firm for personal finance.

  1. Create a financial calendar

If you don’t trust yourself to remember to pay your quarterly taxes or periodically pull a credit report, think about setting appointment reminders for these important money to-dos in the same way that you would an annual doctor’s visit or car tune-up.

A good place to start? Through a financial calendar.

  1. Check your interest rate

Q: Which loan should you pay off first? A: The one with the highest interest rate. Q: Which savings account should you open?

A: The one with the best interest rate. Q: Why does credit card debt give us such a headache? A: Blame it on the compound interest rate.

Bottom line here: Paying attention to interest rates will help inform which debt or savings commitments you should focus on.

  1. Track your net worth

Your net worth—the difference between your assets and debt—is the big-picture number that can tell you where you stand financially.

Keep an eye on it, and it can help keep you apprised of the progress you’re making toward your financial goals—or warn you if you’re backsliding.

  1. Set a budget, period

This is the starting point for every other goal in your financial life. Seek out a checklist for building a knockout personal budget for you.

  1. Consider an all-cash diet

If you’re consistently overspending, this will break you out of that rut. Unbelievable? The cash diet changed the lives of these three people.

  1. Allocate at least 20% of your income toward financial priorities

By priorities, we mean building up emergency savings, paying off debt, and padding your retirement nest egg. Seem like a big percentage?

  1. Budget about 30% of your income for lifestyle spending

This includes movies, restaurants, and happy hours—basically, anything that doesn’t cover basic necessities. By abiding by the 30% rule, you can save and splurge at the same time.

  1. Draft a financial vision board

You need motivation to start adopting better money habits, and if you craft a vision board, it can help remind you to stay on track with your financial goals.

  1. Set specific financial goals

What are your money goals? Use numbers and dates, not just words, to describe what you want to accomplish with your money.

How much debt do you want to pay off—and when? How much do you want saved, and by what date?

  1. Love yourself

Sure, it may sound corny, but it works. But taking control of your finances is a way to value yourself really.

  1. Banish toxic money thoughts

A self-fulfilling prophecy of sort! If you psych yourself out before you even get started (“I’ll never pay off debt!”), then you’re setting yourself up to fail. So, don’t be a fatalist, and switch to more positive mantras.

  1. Learn how to savour

Savoring means appreciating what you have now, instead of trying to get happy by acquiring more things.

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