More than half the U.S. population doesn’t have enough money to cover a $1,000 emergency, according to a survey from GOBankingRates. If you’re among the 58% of Americans without a solid savings account or your personal finances are otherwise pinched, now’s a good time to evaluate how to manage your money.

Saving is important because it can prevent you from taking out high-cost loans to cover expenses. It’s not always easy to pinpoint how to save money. One of the most important steps involves taking a good, hard look at the money you have coming in versus the money you have going out so you can establish a solid budget. Then you have to stick to your plans

Here are six easy steps to help you get control of your personal finances. Once you gain control, you simply have to maintain some of the tasks so you can stay in control.

Understanding & Managing Your Money

Here’s a quick list of the things you need to know to manage your money:

• Income: Know what you receive/earn monthly.
• Expenses: Know how much you spend every month.
• Balance: Expenses must be less than income.
• Save: Put some of the extra money away for a rainy day.
• Consistency: Stick with it. Budgets only work if you work them every month.
• Monitor: Keep track of your money and your credit, so you can create a solid financial foundation for the future.

1. Evaluate Your Income

How much money do you have coming in? Including your paycheck is a given, but don’t forget other income. That can include alimony, child support or any other miscellaneous cash that you might have coming in. Write it all down and add it up.

2. Calculate Your Expenses

One of the most difficult steps in establishing a budget is determining how much money you’re spending. Make a list of your fixed expenses, which may include the following.

• Rent and/or mortgage payments
• Car payments
• Child care expenses
• Insurance
• Utilities
• Cable
• Other subscription services
• Other loan or debt payments, such as for credit cards

Next, include variable expenses such as food, gas and entertainment. Don’t forget about miscellaneous and maintenance expenses like property taxes, car maintenance, tag renewals and birthday gifts.

Once you’ve added up your outgoing monthly expenses, subtract them from your income. That tells you whether you’re spending more than you earn. You’ll also get a better idea of where you can cut back. Depending on how widely your income and expenses vary, you may need to do this monthly.

3. Find Areas to Cut Back on Spending

One way to determine areas where you can cut costs is to categorize expenses as needs and wants. This can add a new perspective to your budgeting efforts and give you the extra push you need to cut expenses that aren’t needs. Other ways to scale back on your overall spending are listed here.

• Shopping around to see if you can get cheaper contracts with service providers, including a cable company or cell phone provider
• Calling existing service providers to see if you qualify for a lower rate or discount
• Looking into budgeting apps that help you monitor monthly spending and provide alerts if you’re spending more than you should in specific categories
• Paying credit card bills more than once a month to prevent balances from climbing too high
• Considering a balance-transfer credit card that offers a 0% introductory annual percentage rate to minimize costs associated with any credit card debt you’re carrying

4. Pay Yourself—Make Sure You Save

Don’t forget to leave room to pay yourself. Setting aside enough money for savings or an emergency fund can make all the difference in the world when you’re blindsided with an unexpected job loss or financial emergency. If your home AC unit needs a major repair or your car breaks down, a solid savings account can mean the different between handling the issue immediately in cash and making a decision such as taking out an expensive payday loan.

Ideally, you should aim to have at least six to eight months’ worth of expenses in your emergency fund. But even having $1,000 as a backup is better than no backup at all. If you’re struggling and can only afford a little each week, setting aside even $10 a week is better than nothing.

5. Stick to Your Budget

Sticking to a budget can be the most difficult part because it requires some will power. Check out the tips below to stay in control of your money with strong budgeting and decision making.

How Can I Better My Life Financially Via Budgeting?

• Be realistic. You probably can’t save 50% of every paycheck, and if you have a family of four, groceries are likely to cost more than $25 a week.
• Plan ahead. Planning meals, outings and gift shopping as far ahead as possible lets you take advantage of deals and coupons so you pay less overall for these expenses.
• Work together. Get the entire family involved, and especially, work closely with any spouse or partner. If you’re not both buying into the budget, it’s harder to maintain.
• Auto draft savings. Pay yourself first by auto drafting a certain amount from your checking into your savings every payday. That way you can pretend that money doesn’t exist, and you’re less likely to spend it with intentions of replacing it later.
• Pay with cash. Studies show that people buy more when they use credit, in part because the psychology of spending is different. Keep your spending down by paying in cash whenever possible.

6. Monitor Your Credit Going Forward

Keep in mind that having a good credit score can be instrumental when it comes to controlling your finances. It helps ensure you qualify for the lowest interest rates if you ever do need to borrow money. That can save you a lot when you buy a home or car or apply for other loans. Those lower interest rates equate to lower monthly payments, which makes it easier to control your budget.

You can look at your free credit report from Credit.com. And if you’re not sure where to start with monitoring, repairing or protecting your credit, consider starting with the free credit report card. It updates every 14 days and gives you an easy-to-understand snapshot view of how your credit is fairing in major categories. That way, you know exactly what parts of your personal finance you may need to work on in the future.

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