How to Spend Money Wisely - Go from Broke to Rich!

February 2, 2021 | Peyton Sawyer

If you’re living paycheck to paycheck – you’re the majority. No matter what you earn, if you don’t know how to spend money, you can still be broke. That is what happens when you’re bad at managing your income. To go from broke to rich, you shouldn’t just be thinking about how to earn more money, you should also learn how to spend money most efficiently: in a way that will allow you to get maximum benefits with minimum input.

And we’ve got a few tips on how to do just that.

Manage Your Income with Maximum Benefits

1. Start Budgeting

Are you a budgeter? Great! If not – now’s the time to start. Your budget is the single most useful tool when it comes to controlling your spending. Take a good look at your bank statements – it’s likely you’re leaking money dollars at a time and not paying attention to how to spend money.

It’s easy to overspend on things we don’t need, and easier on things that we do. Groceries, for example, are some of the easiest things to overspend on – if you simply pay attention to how much you’re buying, stock up your freezer and pantry when there is a sale, instead of paying full-price. Buying a generic brand instead of name brands can also help to save you a considerable sum.

2. Downsize

Could you be paying less on what you buy? Do you know how to spend money? That’s important.

  1. Your rent and utilities – they can hardly be renegotiated, but could you perhaps move to a cheaper rental? Or use a more energy-efficient approach to your utilities?
  2. How many subscription services and memberships do you have? Do you have cable service? Are you a smoker? – Leave only one or two subscription services you use more often and opt out of the rest, try to cut down the number of cigarettes you smoke or quit, and switch from premium apps to free ones, you’ll notice a significant difference in your spending.
  3. Which of your bills can be renegotiated? – There’s a possibility you could be paying less on your bills, ex. car insurance and credit cards. Try an app like Trim or Truebill to figure out which bills you can renegotiate.
  4. Could you be driving a cheaper car? – If so – make a switch. Remember, a car doesn’t need to look cool, it just needs to be reliable and safe.

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3. Set Up an Emergency Fund

There’s no true financial stability unless you have an emergency fund – one that covers at least 3 to 6 months’ worth of your expenses.

Remember, the biggest financial emergency is job loss. If your fund isn’t able to cover it, you’re not finished putting money into it yet.

4. Pay Off Your Credit Cards Every Month

Credit cards – especially ones that offer bonuses and cash backs – can be great if you know how to spend money. Try not to keep more than a couple and treat them as if they were debit cards – only spend the amount you know you’ll be able to cover in full at the end of the month.

That’s how you take advantage of the benefits without going into debt.

5. Allow Yourself to Have Fun

Put free spending money in the budget when learning how to spend money. While you should undoubtedly prioritize the must expenses (bills, gas, groceries) over want expenses (takeout, nights out with friends, new clothes, etc.), the wants could bust your budget if you deprive yourself for too long.

Instead, allow yourself to spend money – but only if you know how to spend money by using an amount you’re comfortable with. Be smart about how you spend – thrift instead of buying new; don’t make impulsive decisions, plan your lunch dates with friends, etc.

And set up sinking funds for bigger purchases (like concert tickets or new gadgets) and save up for them little by little instead of buying them on credit or skipping the savings.

SEE RELATED: How to Become a Millionaire Fast

6. Know When to Take on Debt (and Which One)

Sometimes taking debt on is the smart choice. A mortgage is a smart debt, a car loan is a smart debt, an emergency loan is a smart debt – but you should always consider every aspect of them before making a decision. Don’t rush and take debt on just because you want something, take it on when you’re in need.

Say you’ve been hit by an emergency – your pet needs surgery – and need money as fast as possible, but your fund isn’t in place yet. This is a good reason to take out a short-term fast loan like a title loan, without feeling guilty about it. A title loan is how to get emergency cash today.

Why a Title Loan?

Title loans are quite possibly the easiest loans to take out: since it’s a secured type of loan and your car will be acting as collateral, the lenders are relatively free in their approval process. They will accommodate all kinds of income and they won’t be paying attention to your credit score – so you can qualify for the loan even if your credit is bad or outright non-existent.

How Do I Take Out a Title Loan?

You can apply for a title loan online by going to IdahoTitleLoansInc.com and filling out the request form. Once you are done, you’ll be contacted by a store representative who’ll provide the information about the loan and set up a meeting with you.

At the meeting, you’ll need to provide your car, your car’s lien-free title in your name, and your government-issued ID (you must be at least 18 to apply) for the assessment. If the store representative approves you for the loan, you’ll get the money you qualify for the same day.

Managing your finances by learning how to spend money to get the maximum benefits does not have to be a difficult task. If you start small and take one step at a time, what was once thought to be an overwhelming task, can be done with ease. If you need a little help along the way, remember, Idaho Title Loans Inc is here to help. With the fast cash emergency title loans that are available the same day you apply, you can get back on track in no time at all.