Someone putting a coin in a piggybank atop cash

Have Your Cake and Eat It, Too: A Quick Primer on Personal Financial Responsibility

March 10, 2017

in expat finance, money, new york city

This is a guest post by Katerina Crowder. Featured image from by 401(K) 2012 on Creative Commons under this license

Life in the city is expensive. The bare necessities such as food and housing cost more, in some cases a lot more, if you want to live in a neighborhood close to all the action. Even if you’re content to swap convenience and higher rent for a subway ride and lower rent, you’ll still most likely pay a premium for your city digs.

Then there are the things that make life worth living such as nights out sipping cocktails and trying new restaurants. The only thing that softens the blow when the check arrives is the glass of wine you had at dinner or the expertly crafted artisan cocktails you’ve already imbibed.

With some good financial tricks and habits, it’s possible to enjoy life in the big city and develop some responsible financial habits that will help you save up for that much needed vacation from city life, and beyond.

Where, exactly, does all your money go?

Most people have no idea how they spend their money every month. Sure, we know what we’re paying for rent, cell phone bill, internet, etc. but, how much are you spending on groceries, coffee and all the other little things that can seriously add up to big bucks every month?

Really, the first step to saving money and getting your finances in order is to start keeping track of your spending. Here’s the thing, once you see what you’re spending your money on, it can really help to clarify and decide where to trim the fat. Sometimes we find ourselves spending a lot more money on things that we don’t really derive that much pleasure from, and if that’s the case, it’s easy to make a change.

A pile of coins

Courtesy Judy van der Velden on Creative Commons under this license

Fortunately, there’s an app for that. Dollarbird is a free, currency-neutral app that helps users plan and track their spending throughout the month. One of the nicest features of this app is the manual input that allows you to track cash purchases as well. Dollarbird displays your financial information in an intuitive and easy-to-understand chart that tells you your financial fitness in an instant.

You won’t miss what’s already gone

Open a savings account and set up an automatic monthly transfer from your checking to your savings account. You will be surprised how many banks offer this service; chances are your bank does, too.

Start off by transferring a monthly amount that you know you’ll be comfortable with and will have little to no impact on your quality of life. We want to make this as easy and painless as possible. After a year, up the amount by 3 to 5 percent, or do it sooner if you get a nice raise.

Once you graduate from personal finance neophyte to, um, personal finance brown belt, you can start thinking about putting your savings in a place where it will accrue a bit more interest, but for now, we just want to develop some good habits.

Visualize your goals

Financial discipline isn’t always easy, and there may be times when you’re tempted to whip out the credit card and go crazy. Fair enough. In times like these, it always helps to take a deep breath, close your eyes and visualize the lifestyle for which you’re working and saving.

Chairs on a beach

Courtesy Richard Walker on Creative Commons under this license

If that’s not doing the trick then take a chance and play the US Mega Millions lottery, that’ll certainly get your imagination going to help you strengthen your resolve to keep working hard and saving, or better yet, you just might win!

Find a partner

Getting on the right financial footing is a lot easier when you’ve got someone to hold you, no pun intended, accountable.

Find a partner who is also motivated to get their finances in order and develop good, responsible habits. Together, you will be able to strengthen each other’s resolve, bounce ideas off each other and look out for one another to make sure you’re sticking to the plan.

If you’re unable to convince a friend to be your partner in crime, so to speak, is a great resource for finding personal finance and investment groups in your area.

Scrabble SAVE on dollar bills

Courtesy 401(K) 2012 on Creative Commons under this license

Next steps

Once you begin to develop some good habits, a bit of momentum and some savings, you’ll be ready to take on bigger projects like saving and planning for a house, family or retirement.

If that scares you, it shouldn’t. The fact that you’re reading this article and willing to take the first steps towards getting your financial house in order means that you are already ahead of the game. Take the tips in this article to heart, and you’ll be surprised at how easy it is to take control of your finances and your future.

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