Five Daily Activities to Improve Your Finances
by Jason
(photo Creative Commons Flickr - alancleaver_2000)
Often
times when we set big goals such as getting
out of debt, or losing 100 pounds, we immediately feel
overwhelmed by the amount of effort required to reach
those goals. It’s no secret that the best way to stay
motivated is to break these goals down into smaller,
more manageable goals.
I like to break things down to daily battles, that
if won, will ultimately help me reach my goal. Here
are five daily battles I’ve fought each day over the
past year and have helped me hit (or get close to hitting)
the goals I set for myself back at the first of the
year.
- Maintain
a spending journal. Journaling is a great way to introduce accountability
into your life. Whether it is dollars or calories,
keeping a journal of expenditures provides a way
to keep track of your daily outgo. It also helps
you identify trends that may be valuable in creating
next month’s budget, or help in reducing a particular
budget category.
Write down all of your expenses in the journal and
give them a category (housing, food, clothing, school
expenses, gifts, etc.). At the end of the month group
these expenses together. You might be surprised to
learn you spend $200 eating lunch out with coworkers
every day, or $2.00 a day at the vending machine.
- Develop
a passive income. Developing a passive income is one of the keys to
building wealth because it puts your money to work
even when you are not. Passive income may be derived
from things like interest accumulation, royalties,
rent from real estate holdings (although landlords
would argue this isn’t exactly a passive activity),
social lending somewhere like Lending Club, or you
can get close to passive income with activities such
as blogging, or selling e-book products online. Even
if you only make two or three dollars a day, that
is $60-$90 per month that you would not have earned
otherwise.
- Make
micropayments on outstanding debts. Many people are now familiar with the concept
of snowflaking-collecting small amounts of “found”
money and pooling it for a purpose such as savings,
paying off credit cards, etc. Well, I like to take
that same method and apply it to debt reduction.
Some refer to this method as “snowballing,” after
the other popular personal finance concept, the debt
snowball. Using any extra money I can squeeze out of
my budget, or from passive income, I make small payments
throughout the month on outstanding debts. If I left
the amount sitting idle in my checking account chances
are I would spend it before it was applied to debt.
- Update
your budget. At
risk of seeming obsessive, I like to update my budget
every single day. I wake up early, and part of my
routine is to review my checking account from the
day before and mark cleared items in my checkbook.
I then subtract any outstanding credits, and add
back any outstanding debits, to balance my paper
register with the online system’s current available
balance.
Like I said, it may seem a little excessive, but after
going weeks without balancing my checkbook register
I found this daily action helps keep financial stress
away because I always know exactly where I stand.
- Read
something educational every day. I start my day off reading posts from
about twenty-five of my favorite blogs. Then I check
the news headlines online before moving onto a magazine
article or book chapter I’ve bookmarked the night
before. Throughout my day I try to carve out time
to read some of the newspaper for local happenings,
and usually wind up my day reading more from a book.
I had a goal of reading a non-fiction book every week,
but quickly burned out thanks to my hectic schedule.
Perhaps a book every other week is a more feasible
goal for this year. Either way, the idea is to read
something educational every single day. And if you
can sneak in something finance related, even better.
I have discovered the hard way over the years that success
usually comes to those that win the daily battles. You
might have noble goals such as to lose 50 pounds in 12
weeks, or pay off 50% of your debt in six months. However,
if you don’t win the daily battles you will not reach
those long-term financial goals.
# # #
Reposted with
permission from www.frugaldad.com.
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