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Managing your money is the cornerstone to building long-term wealth, and the first step in doing so is to get organized. Many people have great intentions with their money, but still, feel intimidated about the topic. Managing your money doesn’t have to be difficult though. Knowledge is power, and along with that, the right tools and systems can make money management simple, streamlined, and dare say, enjoyable!

Let’s take a look at the best tools to help you manage your money and take control of your finances in 2021.  

Budget Spreadsheet

The absolute best tool to help you get organized and manage your money is by utilizing a budget. Having a budget provides a clear picture of the money that is incoming and outgoing on a monthly basis. Developing a budget starts with creating a budgeting spreadsheet; don’t worry, you don’t even have to create one yourself. There are numerous budgeting spreadsheets available online –– both for a fee and for free –– where all you need to do is input the numbers. 

Having a simple Excel or Google Sheets budget spreadsheet allows you to access and manage your finances at any time from any place. This comes in especially handy when there is more than one person utilizing the same budget, for example, you and your spouse/partner. Ideally, look for a budgeting spreadsheet that allows you to budget for income and expenses, but also can track savings and a debt payoff tracker. As you utilize a budget over time, look for trends with your money, to see where the majority of your spending is and at what times of the month. This kind of insight will help you adjust accordingly, whether it’s when you pay your bills or reducing the subscription services that you use. 

Debt Payoff Calculator

Debt is the bane of wealth creation. Outside of a mortgage, carrying any kind of debt long-term does nothing but steal your hard-earned money through interest rates. A financial goal for anyone should be to become debt-free, except perhaps for a mortgage payment. There are many strategies to pay off debt such as the debt snowball method or debt avalanche method. Some people who have gotten into unmanageable debt look to professional organizations such as debt settlement firms to assist with their debt issues. Whatever strategy you employ to eliminate debt, one of the most important tools at your disposal is a debt payoff calculator. 

You can find numerous debt payoff calculators online for free that makes it quite simple to track how long it will take to wipe out your debt. The reason a debt payoff calculator is such a useful tool is that you get a clear picture of exactly what’s necessary to reach your debt elimination goal. It’s extremely satisfying to see your debt being lowered every month and realize additional funds becoming available for savings and investments. A debt payoff calculator not only helps you get organized, it keeps you motivated. 

Automatic Bill Pay Services

Another extremely useful tool for money management is auto-bill paying. This service is not something you even have to look for to utilize; it’s likely that your bank offers it for free. A very important aspect of money management is ensuring that your bills and debt obligations are paid on time. Life can get hectic and even the most responsible of us can inadvertently miss a payment. To avoid a lapse like this, simply set up automatic payments through your bank for your utility, mortgage, auto loan, and any other prearranged debt obligations. This tool simply helps take one less item off your to-do list every month. Knowing that all of your bills are paid on time without you having to spend time logging into multiple accounts every few weeks is a relief.

Automatic Savings Transfer 

Another cornerstone of responsible money management is savings. Especially if you have had issues with dedicating a portion of your income to saving in the past, setting up an automated transfer to a dedicated savings account can be a very useful financial management tool. One place this is especially important is in funding an emergency savings account. It’s been documented that most Americans do not have even $400 available to cover the cost of an unexpected expense. Yet, these types of costs inevitably show up for everyone at some point. Whether it’s an expensive car repair, an unplanned visit to the doctor, or an urgent home improvement project, life is full of surprises that often cost money. For that reason, it’s critical to have money put away to cover these types of costs. The alternative is they get put onto a credit card and become part of a never-ending spiral of debt repayments that only get more expensive (by adding to the original cost) as a result of interest charges. Having an emergency savings fund dedicated to these types of expenses is just smart money management, so make it easy on yourself by leveraging the automation of your savings. Automatic savings transfers are another easy feature that you can set up with your bank. You can schedule the exact amount and the exact day that you want them to occur so that it always coincides with your payday. In many cases –– if you have direct deposit with your employer ––  it’s possible to set up direct transfers of a portion of your paycheck into a savings account, so then it literally is something you don’t have to even think about. By utilizing this service, you’ll eventually begin noticing your savings grow after a few months, which is certainly exciting!

If you’re serious about taking control of your finances this year, then consider some of these tools to help you in managing your money. Financial organization and clarity is the seed of wealth building, and each of these tools can help make the process simpler, more streamlined, and efficient. You might even find that you enjoy the process along the way!

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