So you want to manage your money, but you’re not exactly sure where to start – or even what the term “money management” includes.
Whether you’re taking the first steps in money management or are already well on your way, we’ve got you covered with the strategies and tools you need to take your finances to the next level.
What Does it Mean to Manage Your Money?
The basic goal of money management is to have control over your finances, rather than your finances controlling you. It’s the regular practice of mindfulness in your spending and savings habits, creating less financial stress in the now and setting you up for financial success in the future.
Not so much. Between the lingering impacts of the Great Recession, all-time high student loan debt, and a housing market that leaves little room for newcomers, millennials are facing an uphill battle when it comes to getting their finances in order.
Money Habits of Millennials
According to a 2022 study by Investopedia, 46% of millennials self-reported that they aren’t saving enough money, with nearly 40% of respondents stating that retirement by age 65 feels out of reach.
With so many struggling to reach their long-term goals, it begs the question: how are millennials actually spending their hard-earned dough?
The answer isn’t pretty. That same Investopedia study found that although 70% of respondents defined financial stability as just being able to pay all their bills each month, around 50% of respondents reported having to rely on credit cards to pay for basic necessities.
Another important factor? This generation isn’t just focused on pay rate when it comes to choosing their places of employment. Unsurprisingly, they’re also focused on finding a workplace in which they feel respected and treated fairly.
While all these statistics may feel discouraging to younger investors, the truth is that it just makes money management even more imperative.
Why Is It Important to Manage Money Well?
We’re not going to sugarcoat it – it’s tough to build wealth right now. But that doesn’t mean there’s nothing you can do about it. With healthy financial habits, some key strategies, and a host of tools to help, you can create a plan to stay on top of your money and get on track for your goals.
Knowing the ins and outs of where you spend your money, as well as the “whys” behind those habits, can help you weather these economic times and better manage your money.
How to Become the Money Manager of Your Dreams
While every individual has a unique financial story, there are some common skills you can use to manage your money like a boss.
You should pinpoint what all that hard work is for in the first place, so that when the times get tough, you can think back on your motivations. And get more specific than just “save money” – what are you saving money for?
Is it to pay off that credit card debt this year? To pay all your bills on time this month? How about to buy a house in the next 5 years?
The more specific you can get with your goals, the better. Also spend some time reflecting on which goals you want to prioritize – that way, when your money isn’t stretching as far as you’d like it to, you still know where it should go.
And when you do finally reach those goals, don’t forget to celebrate your win!
Build a Budget
Next up: building a budget. You’ve probably heard it before, but a budget is a must for anyone who wants their money management to be a smashing success.
Your budget should include every dollar that comes into your life, and every dollar that leaves your life. Sometimes creating a budget can help you see that your spending hasn’t exactly been on track with your priorities (wait, how many times did you DoorDash dinner last week? No judgment 👀).
A budget can also help you find new ways to cut some spending from your life. Like when that pesky internet company ups your bill without warning? Or when you find out your friends are paying half as much in car insurance each month? That’s when you know it’s time to shop around for better deals.
But the way to get the absolute most from your budgeting? Check in frequently. Your budget doesn’t do any good if you never look at it again. Think of budgeting as a side quest to your larger goals. You can’t beat Bowser if you don’t spend some time stomping on Goombas first.
Always Be Learning
When it comes to finances, there’s always more to know. That’s why it’s so important to keep educating yourself so you can find the best opportunities for saving and growing your wealth.
And don’t worry, you don’t need to enroll in a college accounting class to get the lowdown – you’ve got the entire cyberspace at your fingertips. Sign up for a financially-focused newsletter or listen to a podcast on your daily commute.
Open yourself up to learning from others. Talk about money skills with your friends and family, or reach out to an advisor. What ideas can you borrow and improve upon to work best for you?
Use Tools Available to You
From budgeting to investing and everything in between, there’s a ton of tools out there to help you on your money management journey.
Starting from square one? See if your bank has an app that can help you view your accounts on the go. Ready to connect with an advisor and start investing? Anonymously browse your options through the Lasso app. Whatever step you’re ready to take, don’t be afraid to put yourself out there.
Online tools and apps can help you reach your goals with less hassle and bring you one step closer to becoming the money manager you want to be.
Make the Most of Your Moolah with Lasso
Ready to manage your money like a boss? Download Lasso today to start building plans and saving toward your goals.