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5 Smart Money Moves to Expand Your Wealth

Creating wealth may seem as easy as bottling lightning (not easy!). But the truth is, baby steps taken every day will get you there. Try these tips.

by Firstly Staff | January 20, 2023
<p>Young woman looks at phone, smiling, with credit card in hand, smart money moves</p>

Adopting good money habits is the only way to create a life free of financial stress and to start building wealth. As with all habits, once you incorporate them into your life, you’ll find yourself doing them without even thinking. So, here are four good money habits you can adopt today to put you on the road to financial freedom.

1. Become a Conscious Consumer

Conscious consumers are constantly on the alert for ways to save money. Coupon-clipping may strike you as boring, but when you can save $20 to $30 and more off of your weekly grocery shopping, that time investment suddenly feels very valuable.

When you become a thoughtful consumer — think, check, compare before you buy —  you learn that there are bargains to be found everywhere.

For example, does your bank offer free checking? If not, it may be time to investigate other banks that do offer free checking. 

What about your monthly bills? Are you getting the best rates for your internet and cell phone plans? Believe it or not, these rates can sometimes be negotiable. If you see an alternate carrier offering a plan that costs less than what you currently have, call your vendor and ask if they will meet that price in order to keep you as a customer (it is much cheaper for a company to maintain a current customer than to land a new one). 

But the most important part of conscious consuming is this question: Do I need this? Is this a must-have right now item? If the purchase can be deferred or delayed, then way. A lot of times that need will vanish and you'll still be holding on to the funds you would have spent.

2. Automate Your Financial Life

Making good financial habits automatic — something that doesn't require your thought or attention once you've set it up — makes good sense. You can improve your credit score, save money and more with a few automations.

BILL PAYMENT Automating your bill payments means that you will never accidentally miss a payment or be late to pay, which will help you maintain a solid credit score. (Frequent late payments can ding your score; missed payments always have a penalty.) With a good credit score, you’ll save money — lots of money! — whenever you need to secure financing, for a mortgage or to buy a new car. This is because the highest credit scores earn the lowest interest rates.

SAVINGS "Pay yourself first." It may be a cliché saying, but that doesn't mean it's not the right idea. Set up automatic savings deposits from your paycheck and you'll see how quickly that little bit of money will add up over time. You will adjust to your new pay amount, and without those funds showing up in your bank account, you'll be free of the temptation to spend that money. As a result, you’ll meet your retirement and emergency savings goals and will avoid the need to use credit cards or loans to pay for unplanned expenses. And the number-one thing that keeps people from going into debt is having sufficient funds for life's emergencies — a car repair, temporary job loss, etc. So it's not just savings you're earning; you're also creating peace of mind.

3. Make the Absolute Most of Retirement Funds

If your employer offers a 401(k) retirement plan, it is truly in your best interest to take advantage. If you can max out contributions, because it takes too big a bite out of your paycheck, at least make sure that you are contributing enough to get any and every penny your employer is matching. Some employers will give a 50% match — meaning half of what you put away — up to a certain percentage of your contributions, say 3% of your salary. This is FREE MONEY. Let us repeat: FREE MONEY you are earning by working for this organization. Do. Not. Miss. This!

4. Spare Change is Just Savings Waiting to Happen

We may be moving toward a cashless society, but let's not lose another opportunity for mindless saving: the spare change jar. When you come home, take whatever loose change or $1 bills you have in your pockets or wallet or bag and chuck them in a jar. After a few months, you might have saved enough for a couple tanks of gas or a grocery run. 

5. Develop a Habit of Regularly Checking Your Credit Report

As we’ve discussed in previous articles, your credit score impacts almost every facet of your life. But most importantly, a poor credit score deprives you of the cash you need to meet your financial goals. Therefore, you must develop a habit of regularly checking your credit report to ensure that your score is a true reflection of your debts and your habits.

According to a June 2021 Consumer Reports investigation, 34% of Americans found at least one error on their credit report. The most common errors were related to personal information, but 11% found account information errors. You’re entitled to one free credit report every year from each of the three reporting agencies. It’s an easy habit to adopt, it doesn’t cost you anything, and you could potentially save lots of money.

Bottom Line

Adopting good money habits is one of the top secrets of people with good credit. By automating your savings and bill payments, looking for bargains, and paying yourself first, you’ll have less money going to debt reduction and more to your financial goals. 

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