How to Get On The Right Financial Track

Managing your finances can be a challenging task, especially if you're not sure where to start. Getting your money on the right track is important for achieving your financial goals. Here are some tips to help you get your finances on the right track:

Create a budget

The first step in getting your finances on the right track is to create a budget. A budget will help you understand how much money you have coming in and going out each month. Once you have a clear picture of your income and expenses, you can start making changes to improve your financial situation.

Track your spending

Now that you have a budget, it's time to hold yourself accountable. Knowing where your money is going is key to controlling your spending. Keep track of your expenses for at least a month and categorize them, this will give you a clear idea of where you're overspending and where you can cut back. I find it helpful to use a spreadsheet but you don't need anything fancy to get started. Grab a piece of paper and get to work!

Bonus Tip: Watch For Lifestyle Creep - As you make more money, many times people will look to spend more money. What was once thought of as a luxury becomes a necessity.

Pay off debt

High-interest debt, such as credit cards, can get out of control. You should focus on paying off high-interest debt as soon as possible. This will lower the amount of interest you're paying. If you have more than one credit card, you should focus on paying off the card with the highest interest rate first. Once you are out of debt, you need to keep it that way. Avoid carrying a balance on credit cards and save up for big purchases rather than taking out a loan.

Start saving

Saving money is essential for achieving your financial goals. Start by setting up a savings account and make sure to transfer a percentage of your income into it each month. Set a savings goal and work towards it. This is a perfect time to establish an emergency fund as well. Look to stash away at least three months of expenses. This will help to protect you against unforeseen circumstances.

Invest for the long-term

Investing your money can help it grow over time. Consider setting up a retirement account, such as an IRA or 401(k), and start contributing to it monthly. This will help you build a nest egg for your future. The sooner you start investing, the better. Putting your money to work will pay dividends for your financial future due to the power of compound interest. A good starting goal is to save 10% of your income and then go up from there. A financial advisor can help show you where to save your money, how to invest and how much to save to pursue your goals.

Bonus Tip: Self Employed? - Check out this article about retirement savings options for small business owners.

Protect yourself and your family with insurance

Having the right insurance can protect you in case of an unexpected event. Make sure you have adequate health, life, disability and property insurance. We recommend speaking with a financial advisor to make sure you are properly covered. Insurance helps to protect your assets from unforeseen circumstances. Without proper insurance coverage, this could leave you open to significant financial risk.

Review and adjust your budget and strategy regularly

As your income and expenses change, so too should your budget. You should periodically review your budget and spending habits. Managing your finances takes time and effort, but with a little bit of planning and discipline, you can get your finances on the right track. Remember, the key is to start small and stay consistent.

Build a Financial Plan To Get On The Right Financial Track

It also could make sense to put together a financial plan. A financial plan is an in depth overview of your current financial situation. It includes your financial goals and strategies to pursue them. The plan can also tell you if you are on track to achieve these goals. If you would like to take the next step and plan for your future, you can get started for free by clicking below.

Schedule A Meeting With A Financial Advisor

HunterRIDGE Wealth Management is Long Island's premier wealth management firm. From growing wealth to planning for retirement, we are with you every step of the way. To learn more about how we work with our clients and our planning process click here. 

For educational purposes only. Not to be relied upon as financial, tax, or legal advice. 

This information was obtained from sources believed to be reliable, we do not guarantee its accuracy, completeness, or fairness. We have relied upon and assumed without independent verification the accuracy of all information available from public sources. All investing involves risk including the possible loss of principal. No strategy assures success or prevents loss.