5 Things That Good Money Managers Do

To some people, the words “financial sustainability” sound like Greek. When you start out in the real world as a teenager or college student, it is easy enough to find a job, get a free checking account, and start your financial life of earning, spending and maybe even saving. However, too few of these financial fledglings are actually taught good practices for handling their money. Luckily for them, the Internet provides a wealth of knowledge. Here are 5 things that good money managers do that people of all ages can learn from:

1) Know exactly where your money is going each month. A lot of people have only a vague idea, a fuzzy schedule in their head of what their money is allotted for each month. If you’ve got cash to burn, then maybe that’s not the worst thing in the world, but for most people who live paycheck to paycheck, that is setting themselves up for disaster. Having a physical schedule, like a calendar, with all of your monthly payments is a good way to keep ahead of your finances.

2) Contrary to popular belief, a huge tax return should be avoided. It may be nice at the time, since everyone loves getting a huge check from seemingly out of nowhere. Those who are blessed with money smarts, however, will usually opt out of the big check for saving money by not having too much tax withheld from their hard-earned paychecks. Not only does this mean you don’t have this money in the case of an emergency, but you are also missing out on earning interest on that money if you were to invest it in a CD or other interest-earning account. Check over what your work is withholding and make sure it is the correct amount.

3) Putting a limit on needless spending. There are big and necessary monthly expenses, and then there are upsized sugary coffee drinks that you crave every afternoon at 3:00 pm. One of these you can probably skip out on. Extra expenses add up, and money-savvy people tend to add up the estimated extra costs per year, divide them by 12, and add them in as monthly expenses in order to budget for them.

4) Do not save whatever is left at the end of the month. Save at the beginning of the month, or whenever your paycheck comes in. The logic here is that more often than not there is not much if anything left at the end of the month, which means there can be no savings.

5) Payments on credit card debt should be made on debts with the highest interest, not the lowest debt amount. It’s true that paying credit card debt is far better than ignoring the fact that it exists. However, you can be smart about how you pay it off so that it will save you money in the long run. This means focusing on paying off the ones with the highest interest rates, rather than the ones that are smaller but have 0% interest. 

To learn more about financial sustainability and how to be more bank savvy, click here!

Avoid These Five Checking Account Mistakes

You can get a checking account with most banks at the age of 18. However, there are a lot of costly mistakes that you can make with checking accounts that you may not know at 18, or at any age. Here are five mistakes you should never make when it comes to your checking account.

1) Overdraft and fees: This is the biggest let down. Hidden fees and overdraft costs and empty your pockets faster than you thought possible. Many people fall down this well; don’t let it happen to you! Read the fine print when you sign up for your checking account. And think twice before you agree to overdraft protection. Yes, it will save you the embarrassment of having your card declined at the grocery store, but the fees range from $30 to $45 per transaction. That means if you bought a pack of gum and didn’t know you were in the negative, that gum just cost you the same amount as two full meals, at least!

2) Ignoring online banking: Online banking is the best thing since sliced bread. You get to see every detail of where your hard-earned money is going, and now with mobile banking, you can be apprised of your financial situation wherever and whenever you want. Ignoring this gift can get you into a lot of trouble, as many people swipe and swipe and don’t think twice about what’s left in the account. Use this tool to make sure you don’t overspend, and your wallet with thank you kindly. Not to mention you are more likely to catch fraud early on, as well as any discrepancies in your account.

3) Paying for your checking account: Checking accounts should be free! Yes, fees are skyrocketing, and finding a good bank can be a challenge, but you should not have to pay for a checking account. This includes minimum amount fees, which is a fee you have to pay if your account goes below a certain balance. Be sure to ask your banker all the in’s and out’s of what the checking account entails. If you don’t like what you hear, it’s time to find another bank!

4) Paying bills by hand: Unless you are a spectacularly organized individual, paying your bills by hand can often lead to late or missed payments. That’s another thing your online banking is good for. Setting up automatic payments ensures that your bills get paid on time, every time. Just be sure to set them to withdraw when you know you will have funds, like the day after payday.

5) Choosing the wrong bank: Choosing the wrong bank to have your checking account at can be the cause of a lot of these frequent checking account mistakes. The right bank will take care of you, and make sure that you’re checking account is hassle free and works for you.

For more information on being checking account savvy, click here!