Financial literacy hacks: 4 things you can do today to improve your finances

The economy has taken a turn—but you can use this time to strengthen your financial health and plan for a better future. Sharpen your financial literacy with these tips.

Financial literacy hacks: 4 things you can do today to improve your finances

April is Financial Literacy Month—and with everything that's happening in the economy, it's a great time to examine your finances.

By taking stock of your financial health, you'll reduce your money-related stress today while setting yourself up for a brighter financial future. These financial literacy hacks will get you started.

Tip 1: Create a spending tracker

Becoming more financially secure is a process that takes time—but you can make an immediate impact on your finances by beginning to track your spending more closely.

By understanding where your money goes, you can devise a budget that meets all of your needs and allows you to plan for the future. You can identify how much you need to save to meet your financial goals, so you can create a plan for achieving them.

Using a prepaid debit card or credit card can make spend tracking simple. Some cards will even export your spending history to budgeting tools like Mint: for insight into where you're spending and help staying disciplined.

You may find that some spending categories, like groceries or internet service, are relatively fixed from month to month. But there may be other areas, like restaurants or entertainment, where you can find opportunities to save.

Tip 2: Become more intentional with your spending

Tracking your spending is just the first step: Next, you'll want to put your learnings in action by making an effort to spend more intentionally.

Broadly speaking, you can bucket your spending into two categories: wants and needs. In challenging financial times, you should aim to drive down your spending on the "wants," also known as the "nice-to-haves".

The trick is to get in touch with your own values and determine what really matters to you. Maybe you spend a lot on produce every month to provide healthier food at home—or you stretch your budget to hire a tutor for your child. These may areas where you don't want to compromise.

For more budgeting tip ideas around price comparison and meal prep, check out this article.

To improve your financial health, take a close look at every line item in your budget.

“What's really important?

What can you cut out?”

By asking yourself these questions, you can set your sights on how much you need to earn to have the life you want.

Tip 3: Take a deep dive into your career options

The coronavirus crisis has thrown the economy into disarray, and it may not seem an ideal time for career planning. But today's economic situation offers an opportunity to make big changes and better align yourself with your long-term goals.

Perhaps you’ve been unfulfilled at work, or you feel like you deserve more money. Maybe you don't have room for all of the "wants" you defined in your budget. Now is the time to look closely at where you're at and where you want to be—so you can figure out how your work can get you there.

Whether it's picking up a side hustle, working more hours or learning new skills to level up your salary, you will have options for building a firmer financial foundation. By doing research into what's available and inventorying your own skills, you can start to chart a new course in your career.

Tip 4: Drive towards better credit

Your credit may be the last of your concerns right now—but thinking about credit will help you prepare for the medium- to long-term. Having above-average credit will help you save money on credit cards and loans and may even affect your housing and employment prospects. Learn what factors affect your credit score.

There are multiple steps you can take to improve your credit and bolster your future financial security. After checking your credit report for errors that could be bringing down your credit score, you can:

  • Work with a nonprofit credit counseling organization to tackle your debt
  • Take out a credit-builder loan
  • Open a secured credit card
  • Get a credit card with a co-signer

All of these steps are low-cost. To get a credit-builder loan, for example, you simply put down a deposit: which you get back once the loan is paid off. And each of these options will support a positive credit history, setting you up for new and better opportunities in the future.

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