When it comes to your money you want to be organized, productive, and savvy, but do your daily habits align with making those wants a reality?
We get it. It’s hard and the benefits are rarely immediate. But ignoring your finances and delaying developing good habits, is basically tossing your financial fate to luck— and you’re smarter than that.
Knowing where to start is often the hardest part. So, we created this checklist for you to use as a foundation for making smart money decisions. Some of these things take minutes, some take a lifetime, but the first step is to get started.
To Do Now
Estimated time: 2-10 minutes
☐ Automate Bills Payment and Monthly Savings
Now that you know what your time is worth, don’t waste it sorting through recurring bills. Automated payments will help avoid overdue charges and unnecessary interest payments.
☐ Know Your Debt-To-Income Ratio
This lesser known personal finance metric is incredibly important. Lenders use this ratio to determine eligibility and rate. Learn how to calculate your ratio here.
☐ Calculate The Value Of Your Time
You know that time is money, but how much? Knowing how much money each hour is worth to you will help you make wiser decisions about how to spend that time. For example, how much would you be willing to pay a TaskRabbit to run errands for you so you could spend that time in more productive ways?
To Do This Week
Estimated time: 1-7 days
☐Consolidate & Refinance High-Interest Debt
Combine credit card debts into a single loan and making sure you’re paying the lowest rate on existing debt to save time and money. Check your rate and use our loan calculator to compare rates.
☐ Create A Will & Talk To Your Parents About Theirs
Learn about the components of a viable will and your state’s requirements. Here is a quick guide on how to write your will. Talking to your parents can be uncomfortable, but knowing what they want is important. Don’t leave things up to chance.
☐Create A Budget
Create a budget and track your finances. It’s easy with tools like Mint. Failing to plan is planning to fail.
To Do In The Next Few Months
Estimated time: 3-6 months
☐ Establish An Emergency Fund
Separate from your savings account, an emergency fund is a financial cushion to be used to provide quick cash in unexpected, urgent situations. Try to set aside $1000 and slowly grow it to cover your expenses for at least three months. Studies show that those without emergency savings are more likely to accumulate debt. Consider your emergency fund as a hedge against debt.
☐ Get Comfortable Talking About Money
Learn how to talk about money and surround yourself with people whose approaches to saving, spending and investing compliment yours. Talking about money will reduce finance-related stress and relationship-strain.
Start Now & Do Forever
Estimated time: ongoing
☐ Master The Art Of Negotiating
Negotiate your compensation from the start because it will affect your promotions and future salaries. Knowing what you’re worth and asking for what you want will get easier with practice. Here are some negotiation tips.
☐ Get Your Credit Score Above 700
Start monitoring your score regularly and familiarize yourself with how scores are calculated. 700 is an above average credit score so getting, and staying there, may take some work.
☐ Start Investing
You have a long investment horizon and fewer financial commitments—make the most of it! Automated services like Wealthfront make sophisticated investment management easy and affordable.
☐ Grow Retirement Savings
Start saving now, even really small amounts, and benefit from decades of compounded growth and reduced income taxes if you contribute to a 401(k) .
☐ Establish & Repay Multiple Sources Of Debt.
Build good credit by making timely repayments on diverse types of debt (e.g. Personal loan, credit card, car loan, mortgage, etc.