Getting my finances under control has been an interesting journey. I had not used my credit cards wisely, paying bills seemed like a chore, and saving seemed impossible. I feel more confident about my finances now because I learned that working smarter can make personal finances manageable and actually enjoyable.

I’m sure if you ask other personal finance bloggers they’ll tell you once you start applying the knowledge,  it gets easier. If you’re looking for ways to handle your finances, here are some tips:

1. Simplify your accounts. If you have several bank and retirement accounts lying around, see if you can reduce it to a manageable number. It’ll save you time from trying to remember what money belongs where. For some banks, you can also qualify for better rates if you balances are higher.
2. Automate your accounts. Use automatic bill pay and save time and money. Automation frees you to focus on big wins.
3. Track your actual spending instead of guessing. Use Mint, Wesabe, or pen and paper to tracking your accounts and spending.  See what your biggest expenses are and if you are spending less than you earn.
4. Pick 1-2 areas to work on for the next month. Don’t try to ‘fix’ everything at once; it can stop you before you start if you feel overwhelmed. Build some momentum by working on just one or two areas of your budget. My personal suggestions are eating out and movie tickets/rents since these are two unnecessary expenses.
5. Keep your goal in mind. Put a note in your wallet about your goal for the month. It’ll be a reminder to cut back.
6. Only try to reduce those areas, don’t just cut them out completely. You don’t have to completely stop these activities, but be selective with your expenses. Do you have to eat out every day? Can you have leftovers for lunch twice a week? It’s better to start somewhere then plan everything.
7. Keep your receipts in a small pile on your desk. If you keep it in the car or at work, you’re less likely to check what you’re spending. Keep it by your home computer. It takes less than 5 minutes if you do it 3 times a week. Remember if it’s easy to do, then you’re more likely to do it. (Not guaranteed because of the laziness factor of some people.)
8. Repeat steps 2-5 for the next area. Now that you’re working at it and seen it work, then move on to another area you feel you can improve.

How have you simplified your finances? What gives you a hard time when working on your finances? What part of your spending was easiest to cut down on? What expense was the hardest?

Photo Credit: Tracy O

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