By: Frayed Passport
Managing your finances can be a constant struggle, especially if you work for yourself or if you’re embracing the digital nomad lifestyle. Not only may you be faced with a fluctuating income, but you could also struggle to manage your living costs over time.
The key to managing your money is to streamline as much as possible, allowing you to navigate challenges more efficiently and boost your financial confidence. And now that spring is here, it’s a great time to explore your cash in detail and make adjustments!
Here are some tips to spring-clean your finances and help your freelance income stretch further.
Take a Deep Dive into Your Spending
Before you can transform your financial situation, you need to know precisely what you’re dealing with. As onerous as it may be, your first step should be to take a deep dive into your spending. National Debt Relief CEO Alex Kleyner believes it’s important to be more aware of your spending habits, as “Understanding where your money is going is crucial to making informed financial decisions. If you are spending it unknowingly, you could find yourself in a bad debt situation that may be challenging to overcome.”
Analyze your statements across all of your accounts to help you get a clearer picture of where your money goes. It could be a real eye-opener to discover areas where you may be spending more than you should—be sure to check for things like recurring costs you might not need anymore (like memberships or subscriptions you don’t use), or even purchases that can be better swapped to a different account (like using a credit card with rewards points and savings opportunities rather than relying on a debit card).
Find Ways to Reduce Your Outgoing Cash
Once you’ve got a clearer picture of your purchasing habits, it’s time to work through the many ways you can reduce your spending.
No, we’re not saying to cut out the things that give you joy in life—don’t cut out a streaming service or daily coffee run if you like them and they make you happy. Looking at the Forbes article linked above, here are a few quick ideas that may help you save more and spend less, even if it’s a small start:
- Compare and switch insurance providers
- Shop at wholesale stores like Costco for items you can buy in bulk
- Look into loyalty programs for essentials like fuel discounts
- Combine high-interest loans for better rates
Once you get into the habit of cutting unnecessary expenses, it becomes much easier to take control of your spending and make better financial decisions. As with all habits, it’ll take time to change your mindset and break bad habits to form new, healthier ones—but it’ll be worth it!
Start a New Budget
With your finances spring-cleaned, you can create a brand-new budget to help you manage your money in the future. This is a great video to help you understand some budgeting basics:
@hermoneymastery How to budget 🤍 Here are the things that need to be included in your budget: -fixed expenses (all your bills including debt payments) -variable expenses (grocery, gas, date night, fun money, etc. that happen monthly) -sinking funds (specific things you want to save for in the future… ex. Car repairs, vacation, new house, etc… longer term than variable expenses) #budgetingtiktok #howtobudgetforbeginners #howtobudget #moneytips ♬ Chill Vibes – Tollan Kim
There are many great budgeting apps that can help you stay on track as well—find the one that works best for you and your needs, and dive into it! Creating a suitable, sustainable budget from the beginning will help set you up for success.
Spring cleaning your finances will help you build a more secure financial future—and give you peace of mind that the good habits you’re building now will pay off in the long term. And remember to revisit this process every year! It’ll help you handle any changes to your income and spending, and in turn make you much more confident with money.
Featured image by Katie Harp on Unsplash