No doubt you want to make smart money decisions, which is why you’re reading this article. And chances are you’ve made your share of not-so-smart financial moves. Increase the likelihood of making savvy financial decisions by keeping the following tips in mind.
Focus on your goals
One of the surest ways to guarantee making smart money decisions is to keep an eye on your target. Saving for a new laptop? Put visual reminders of your goal around your office and home so that the next time you’re faced with a financial decision, one of your first thoughts will be how the potential move will affect your laptop purchase. Chances are if the decision pushes your goal farther into the future, the move may not be a good one.
Life happens and major events can threaten your financial future. You’re more likely to make smart money decisions when you give yourself time to think. While sometimes you have to act quickly, such as paying to repair a leak in your home or for emergency surgery, the fact is you can sleep on most decisions. Avoid acting out of fear and making a rash decision. Gather all of the facts and consult with several experts, and you’re likely to make an informed decision.
Smart financial moves beget smart financial moves. Focus on what’s worked for you in the past and then do the same. An automatic savings plan is a perfect example of this philosophy. Every time a deposit is made you repeat a great financial move. Keeping track of your saving and spending is also helpful, because it measures your progress and shows you what works.
Surround yourself with good advice
Making sound financial decisions requires good influences. Just as it’s helpful to hang around with other dieters when you’re trying to lose weight, it’s equally useful to surround yourself with good financial advice. Talk with like-minded individuals dedicated to saving money and paying off debt about how they make good financial decisions and you’re likely to do the same.
Take a personal finance class and make it a daily practice to read about financial strategies and advice. Explore the lives and philosophies of financially savvy people. A biography or autobiography of a successful individual will teach you a great deal about making good money decisions. Find a financial mentor you admire and ask how he or she has succeeded.
Learn from your mistakes
Read about the lives of some of the world’s richest people and they’ll admit to making dumb money moves. They also share the fact that some of their stupidest moves led to their smartest decisions. Forgive yourself when you make a bad money decision and focus on examining the wreckage for the jewels of wisdom you’re sure to find there.
What ideas do you have for making smart money moves?
Photo Credit: rachel_titiriga