Now that the new year has arrived what better time to begin a financial journey. Really any time is a good time to step off the hamster wheel of poor money management. If you are anything like me you’re saying to yourself, “where do I even begin … this monster will be the death of me!” So five years ago I decided to enlist the help of a financial adviser. He was great! We sat down, looked at what I owed, what bills I had, how much I made, my goals, etc. Then we allocated the money to each item. I was doing great, then out of nowhere, I fell off the wagon. Five years later I’m ready to give it another try. Trying to get your finances right after doing it wrong for so long is like a drug addict getting sober. It’s hard, sometimes painful, and you have to want to do it. Don’t worry we are going to take this journey together.
When I decided to get back on the path to financial freedom I first pulled my credit. There are plenty of places that offer your credit score. Personally, I use Credit Karma and Discover’s My Scorecard. Credit Karma is usually off by 50 or so points. If you keep that in mind you should be fine.
The second thing I did was sit down and look at my budget. Before with my adviser, we used the envelope method and Dave Ramsey’s Snowballing Debt Method. I wanted to do the same thing again. This time I found an app called Mvelopes that let me do the system virtually.
Finally, I spent a month logging how I spent every dollar. This might seem silly if you are following your budget, but logging gum, bottled water, a lunch here and there starts to add up. The small things are usually what keeps us living paycheck to paycheck or on that hamster wheel of debt.
For this month we are working on:
- Pulling our credit reports
- Creating a budget
- Logging everything we spend money on
Stay focused! You got this!
Do you have tips and strategies on how you got your credit and finances together? We would love to hear about them in our comments.