Top 10 Ways to Manage your Money Effectively

Because proper money management is necessary for you to understand in order to achieve a debt free life – or as close to it as you can get, we are providing out readers with the top 10 money management tips. Based on our experiences with finances, we find that the following 10 money management are the most effective ways to help consumers better understand their money and it will help them achieve a better level of debt free living.

Keep infusing your retirement nest egg with money. When you invest as much of your earning as you can into your retirement fund, you are entering that cash into a tax free account. Be as aggressive as you can afford to be. Typically, 10% of your earnings are a great amount to start with. By sheltering your investments (and hopefully profits) from the IRS until you retire, you can earn more in a tax deferred account than a taxable account. There are many options available to you that can be personally tailored to your needs. If you work full time and are not contributing to any retirement accounts, check your retirement benefits at your employer’s human resources department too.

Understand how your credit applications are scored. If you know how your credit applications are scored, you will have a better chance for getting credit. This is one of the biggest secrets of the personal finance world.

Never get tricked by low-ball rates. Many financial institutions advertise low rates and they are tricky. When you are looking (shopping really) for the best loan you can get, whatever kind it may be – home equity, car loan – never become entranced with any gimmick rates and freebies. Think about the total cost of the loan, first and foremost, based on how much you are borrowing, plus the up front fees and losing costs, where applicable. You may be offered a great rate, but the closing or other up front fees are high – or vice versa. Just understand this at all times. If it seems to good to be true, it most always is.

Pay yourself first. This is something many consumers either never consider or just do not catch on to. Treat yourself like a bill each month. Write yourself out a check of have an amount automatically withdrawn from your checking to a high performing savings type of account each month. Try putting that money into an investment – not just your typical saving account at your bank. Consider saving in a basic account until you can open a CD with it – whatever pays a great return to you. Be sure that money is making the most it can for you wherever you put it.

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