3 Simple Rules To Improve Your Personal Finances

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Nearly 1 in 3 American adults have no retirement savings at all, and 50% of Americans have less than one month’s earnings saved up. This reflects very poorly when you remember that most financial advisers recommend that people have at least six months earnings in savings – but what can you do to turn your financial situation around? From using an online personal finance tool for budgeting to consolidating debt, here are three rules you should follow if you want to improve your personal finances.

Rule #1: Be Aware Of The Differences Between Needs And Wants

If you have a limited amount of money (like the vast majority of people), you should be aware of the difference between needs and wants. Needs include food, accommodation, transport and savings, and wants are things that you don’t need to live. So you may think that you need to make monthly payments for a fancy smartphone, but if you have poor finances that means you are spending more on your wants than you should.

Rule #2: Consolidate Your Debt

Debt is a big problem in American; credit card debt alone is over 201 million dollars, and this number continues to rise with every second. If you have multiple debts that you’re struggling to clear, you should consider consolidating your debts. Debt consolidation often comes with lower interest rates, making it easier for you to clear your debt, and most personal loans don’t require collateral so you don’t have to use any personal items (such as a car) to insure the loan.

Rule #3: Follow A Realistic Budget

A budget is one of the most essential parts of financing. A budget will help you to save for future goals while also helping to reduce your expenses, and it will also make it easier for you to plan financially for emergencies. If you want to create your own budget, don’t forget to include very payment that goes in and out of your bank account, including, alimony, annual bonuses, wages, child support, rent, disability benefits and retirement income.

Lots of people think that it is very hard to improve their personal finances, but in reality that isn’t the case at all. All you need to do is follow these three simple rules to make a significant difference to your financial situation.