Hacks are shortcuts that are developed to create the desired result without going through stress. There are various types of hacks, we have; financial hacks, life hacks, beauty hacks, food hacks, cooking hacks and so much more.
Although, these financial hacks do not magically give you free money (or maybe they do *wink*), they are just tips to help you manage your financial life better.
The following financial hacks, tips and tricks will help you manage your finances better and increase your chances of getting more money;
1. Pay Off Your Debts First
To pay off your debts, start with your bad debts or high-interest debt first. If you have multiple debts, it’s best to begin with, debts that have the highest interest rate then unto the next-highest rates. This releases some sort of burden off you, knowing that you have you’ve taken out the big guns.
Although, some people argue that it is better to invest in markets before paying your debts, but it’ll make a lot of sense to invest without the burden of debt hanging over your shoulder.
Another strategy is paying off one debt with another debt. You can take a loan with a lower interest so you can pay off your high-interest debt. Make sure you do the math, to be sure you’re eligible to take that loan.
2. Take a 30-Day $100 Savings Challenge
You have troubles saving? Well, taking on a challenge that encourages you to save every day until you reach $100 for the month is a good way to enhance that habit.
According to Dr O’Neill, savings challenges provide a structure and target goal. At the beginning of the month, you can start small like putting $1 or $2 away then gradually you can increase it till it is $100 by the end of the month. You can also calculate how much you want to save in a day that will make up to $100 by the end of the month and just stick with it.
Whichever method works best for you, make sure you are saving consistently. If you are not a cash person, set up auto savings that would help you put money in your savings account.
3. Envelope Budgeting System
Envelope budgeting system is one of the old-but-gold ways of budgeting. How it works is, you have an envelope for every expense such as electricity, transportation, groceries, miscellaneous etc. you planned for the month. You put the required amount of money into each envelope and spend from them accordingly. When the money is gone, then it’s gone.
This method of budgeting is especially good for new budgeters or anyone who wants to have more control over their spending. It also helps you save better because you can create a separate envelope for your savings. The only disadvantage of this method is that, once your money is gone for a particular expense, you may struggle a bit till the next month before you can replenish your envelope.
On the long run, this method will make you think twice before spending unnecessarily on this you didn’t need.
4. Pay Yourself First
This is the holy grail of all finance hacks, pay yourself first. For every money you get every month, there will be enough to save for yourself. At least 10% of your income is enough to save before you start spending on the things you desire like food, a new pair of shoes and whatnots.
Savings are necessary, especially for emergencies or if you’re working towards a particular goal, maybe investment or retirement. Make it a habit to not touch the amount you have saved in case of emergencies.
To help you be more disciplined towards saving, you can put your money in a non-accessible savings account and set a particular date that you would like it to be accessible.
Also see: [How to develop a good savings culture in 2020]
5. Start Investing
What good is all that money you have saved if you don’t multiply it? Money loses value every day and vice versa. In the next 10 to 15 years, your money may not worth as much as you think it will. So start investing.
There are tons of options to choose from when it comes to investing. You can invest in stocks, treasury bills, foreign currency and so much more. With the investment, one has to be very careful on the kind of investment you decide to partake in, so you don’t fall into any form of scam, or you don’t lose money due to the market not being favourable.
One of the best financial hacks under investing is to spread your investments, don’t put all your eggs in one basket. This helps you to reduce the amount of risk that may occur from your investments.
6. Start Using Budgeting Apps
These are apps that help you budget your money and also save it. If you are the one who doesn’t know to budget or stick to your budget plan for the month, these apps will help you out.
Some of the apps work differently from others, but the main functions of most of the budgeting apps are to enhance a more efficient budgeting lifestyle.
See: [9 Best Budget Management Apps for You]
7. Build an Emergency Fund
In life, circumstances occur that we have no control over. The smartest way to go about it is to have a plan B, the plan B, in this case, is having an emergency fund. This fund is from the money you have saved over time has come in handy for you. Remember, in case of emergencies, break savings. You would realize how life-saving it can be when unexpected situations happen.
8. Have Other Sources of Income
The more we grow, the more we realize that the money we have may not match the lifestyle we want to live. As we grow, our wants also change to things that require more money. Yes, you may want to cut back on your spending, but what if you increase your income.
How? You may ask, by sourcing various ways to earn money. There are lots of ways to earn money nowadays, it’s either you’re converting a hobby into a job, you’re learning skills to earn money or checking websites that pay you to perform simple tasks like watching a video, answering a survey etc. As long as it is legitimate and resourceful, you can do anything to make some extra cash and increase your savings.
9. Live Within Your Means
It’s no big deal to start a minimalist lifestyle. Most of the things we have, we do not need it. They are just there occupying space and consuming money. You have some old stuff you no longer need? Sell it! Have fairly used clothes and shoes that are just decorating your room? You can sell it on eBay.
10. Dedication
You’ve probably heard this one time too many, but it is the only one that makes all the hacks, tips and tricks to a better financial life worth it. Be dedicated to achieving the life you’ve always wanted for yourself by following the rules that have worked for every successful person on this planet. At first, you might not find it easy, but later on, it’ll be cheesecake.
