15 Practical Ways To Stop Being Terrible With Money

You’ll want to get yourself back on the right track using these tips and tricks.

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Updated June 6, 2024
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Whether you're struggling with debt, living paycheck to paycheck, or simply want to improve your financial habits, there are steps you can take to stop being terrible with money.

By implementing practical strategies and making smarter choices, you can take control of your finances and work toward a more secure financial future.

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Create a budget

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Start by tracking your income and expenses to understand where your money is going. Then, create a realistic budget that allocates funds for essential expenses, savings, and debt repayment.

Stick to your budget to avoid overspending and ensure you're living within your means. Remember to review and adjust your budget regularly to accommodate any changes in your financial situation or goals.

Cut unnecessary expenses

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Identify areas where you can cut back on expenses, such as dining out, subscription services, or impulse purchases. 

By eliminating unnecessary spending, you can free up more money to put toward your financial goals, whether it's building an emergency fund or paying off debt.

Consider using budgeting apps or tools to track your spending and identify areas where you can cut costs.

Build an emergency fund

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Set aside money in an emergency fund to cover unexpected expenses, such as car repairs, medical bills, or job loss. Start small by setting aside a portion of each paycheck and increase your savings over time.

Aim to save enough to cover three to six months' worth of living expenses (more if possible), so you're prepared for any financial setbacks that may arise. 

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Avoid impulse purchases

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Before making a purchase, take a moment to consider whether it's a need or a want. Avoid impulse purchases by giving yourself a cooling-off period to think about the purchase before pulling out your wallet.

Ask yourself if the item is essential or if you can live without it. Implementing a waiting period before making non-essential purchases can help reduce impulse buying.

Use cash instead of credit

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Consider using cash for everyday purchases instead of relying on credit cards. Cash can help you stay mindful of your spending and prevent you from overspending or accumulating more debt.

Use envelopes or a designated cash allowance for discretionary spending to stay within your budget. Reserve credit cards for emergencies or planned purchases that you can pay off in full each month.

Negotiate bills and expenses

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Don't be afraid to negotiate with service providers, such as cable companies, internet providers, or insurance companies, to lower your bills. You may be able to negotiate a lower rate or find alternative providers that offer better deals.

Take the time to shop around and compare prices to ensure you're getting the best value for your money. Bundling services or switching providers can mean access to promotional offers and discounts.

Automate your savings

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Set up automatic transfers from your checking account to your savings account to make saving money easier and more consistent. Automating your savings can help you build wealth over time without having to think about it. 

Consider setting up a separate high-yield savings account for specific goals, such as a vacation fund or a down payment on a home.

Educate yourself about personal finance

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Take the time to educate yourself about personal finance topics such as budgeting, investing, and debt management. 

Plenty of resources, including books, podcasts, and online courses, are available to help you improve your financial literacy and make informed decisions about your money.

Stay curious and open-minded about learning new strategies and techniques to manage your finances effectively.

Seek professional help if needed

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If you're struggling to manage your finances on your own, don't hesitate to seek help from a financial advisor or credit counselor. These professionals can offer personalized guidance and strategies to help you get back on track financially. 

They can also help you develop a plan to achieve your financial goals and improve your overall financial well-being. Be proactive about seeking help, and don't be ashamed to ask questions or admit when you need assistance.

Practice gratitude and contentment

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Shift your mindset from focusing on what you don't have to instead appreciate what you do have. Practicing gratitude and contentment can help you cultivate a healthier relationship with money and reduce the urge to overspend or chase material possessions. 

Take time to reflect on the things that bring you joy and fulfillment outside of material wealth.

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Set realistic financial goals

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Set specific, achievable financial goals for yourself, whether it's paying off debt, saving for a down payment on a home, or building an emergency fund. Break down your goals into smaller milestones and track your progress along the way. 

Don’t forget to celebrate your successes and adjust your goals as needed to stay motivated and focused.

Avoid keeping up with the Joneses

Dmitry Lobanov/Adobe rich kid

Resist the temptation to compare yourself to others and keep up with their spending habits or lifestyle choices. Focus on your financial journey and prioritize your goals and values over societal expectations or peer pressure.

Financial success looks different for everyone, and it's essential to stay true to yourself and your priorities. Practice contentment with what you have and avoid unnecessary comparisons that can lead to overspending and dissatisfaction.

Focus on practice, patience, and persistence

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Improving your financial situation takes practice, patience, and persistence. Be prepared to make gradual changes to your habits and mindset and stay committed to your financial goals, even when faced with setbacks or challenges.

Every small step you take toward better money management brings you closer to financial freedom and security. Stay resilient and keep moving forward, one day at a time, toward a brighter financial future.

Invest for the future

Thawatchai Images/Adobe investment and finance

Start investing for the future to grow your wealth and achieve your long-term financial goals. 

Whether it's through employer-sponsored retirement plans, such as 401(k)s or IRAs, or individual investment accounts, investing can help you build wealth through compound interest and appreciation.

Pay off high-interest debt

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Focus on paying off high-interest debt, such as credit card balances or payday loans, as quickly as possible. Start by tackling the debt with the highest interest rate while making minimum payments on other debts.

Once you've paid off one debt, roll the extra payment into the next debt until you're debt-free. It’s also wise to refinance high-interest debt to lower your interest rates and accelerate your debt payoff.

Bottom line

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To stop being terrible with money requires discipline, commitment, and a willingness to make changes to your habits and mindset. 

By implementing these strategies and prioritizing your financial well-being, you can build a solid foundation for a brighter financial future.

What steps will you take today to start improving your relationship with money and working toward your financial goals?

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Author Details

Adam Palasciano

Adam Palasciano is a personal finance-obsessed and money-savvy individual who loves to hash out content on all things saving money. He specializes in writing millennial-friendly personal finance content, covering topics ranging from trending financial news, debt, credit cards, cryptocurrency, and more.