Six Steps to a Happier and More Stable Financial Situation

Six Steps to a Happier and More Stable Financial SituationSimilar to achieving any goal, creating a stable financial situation requires that you make a plan, and then follow through on it. In theory, it’s easy. But as we all know, following through on your decisions can be difficult. Because of that, we’re going to provide you with six easy-to-follow steps that anyone can follow to achieve a happier and more secure financial foundation in their life.

Step 1: Stop Impulse Buying

The biggest reason why some people are always broke is because they constantly indulge in impulse buys that don’t contribute to their financial goals. Whether it be dining out or making online purchases, we’re all guilty of it. But if you can recognize the severity of this problem, you’ll be in a better position to change it. So stop the spending and only focus on what you need.

Step 2: Track All Expenses

How can you possibly develop a solid financial foundation if you don’t even know where all your money is going? By knowing what your spending habits are like, you can then see where there’s some room to save money.

If you’ve never tracked your expenses before, consider participating in the following challenge: track every expense (even tiny ones) for the next 30 days. Mark them down in an Excel spreadsheet. It doesn’t need to be pretty, just practical. Then, after the 30 days are over, cross out what you don’t need and circle what you overspent on. Now you can successfully cut down on the following month’s expenses!

Step 3: Invest in the Future

If you’re in your 20s, you probably don’t spend a lot of time thinking about the distant future. But you should. There’s no better time than now to start planning for retirement. For example, if you start a 401(k) in your 20s, and contribute to it regularly, then you’ll have a hefty safety net in 30 years. Invest money in stocks, bonds, and mutual funds too. If you’re unfamiliar with how these investment options work, then partake in some self-education (it will go a long way towards helping your financial future).

Step 4: Pay Off Current Debt (and Avoid Future Debt)

If you had to choose only one thing to apply from this article, it should definitely be this tip. Paying off current debt, and staying out of future debt, is the best way to better your financial situation. Avoid taking out too many loans or applying for too many credit cards. If you’ve got school debt, focus on paying that off as quickly as possible. The less money you owe, the more you’ll be able to save each and every month. Even if you can only afford to pay $100 a month towards your debt, that’s still a significant amount after three years (12 months x $100 = $3,600).

Step 5: Use the “Envelope System”

This simple, yet, highly effective system can make all the difference in your finances. Here’s how it works: let’s pretend that you have three different expenses that you have to pay each day (gas, lunch, and dinner). Withdraw the exact amount of money that you plan on spending for each one, and place them in separate envelopes (one envelope per expense). Now you’ll be less likely to overspend, and if you do, then you know that you’re probably spending too much in these areas.

Step 6: Pay Bills Right Away

Don’t wait to pay your bills. Sign up for automatic payments and pay them immediately. The biggest benefit to this is that you won’t forget to pay a bill, which can result in late fees. Secondly, you won’t be able to accidentally spend bill money since it’s taken out of your bank account automatically.

Building a more secure financial situation isn’t going to happen overnight. You need to be patient and disciplined. If you follow the six steps above, there’s no reason why you can’t be living comfortably within two or three years.

Side Business and New Investment Opportunities

Side Business and New Investment OpportunitiesMany state and local governments revised their laws in the aftermath of the recession to encourage new businesses. The reasons are clear.

Additionally, technological and cultural changes result in new opportunities. Consider the following side/main businesses:

Home Baking

If you make a fantastic specialty bread or muffin, you are in luck. Many states revised their cottage food laws, and now people can sell goods baked in their own kitchens through a variety of venues. California’s new law began in 2013, and home bakers can sell directly to consumers through farmer’s markets, roadside stands, and even online. Bakers there can even apply for a “Class B” license and sell their goods to indirect sellers such as restaurants.

Cottage food laws come with several restrictions. Selling foods that have meat or dairy are pretty much prohibited. Some states cap what you can earn from a cottage food operation. In California, cottage food operations could have annual gross sales of $45,000 in 2014 before the operator had to rent commercial kitchen space.


Did your friends turn to you for help with English and Math classes? Are you a teacher looking to make extra money? You should consider tutoring.

Tutoring is big business in America with revenues of $4 billion annually. Parents want to address academic concerns. In response, some areas deregulated zoning laws to allow individuals to tutor more than one person at a time. These changes permit people to tutor a group of three students as opposed to just one student at a time. Skype allows someone to tutor students from the comfort of his or her home.


Marijuana for recreational use is legal in 4 states. Marijuana legalization is on the ballot in Nevada in 2016, and advocates hope to have ballot initiatives in states such as California and Massachusetts for that election. With these changes, you might wonder if investing in a marijuana business is for you.

Marijuana is still illegal at the federal level. There is a risk that a new administration will crack down on marijuana businesses. You also have to be conscientious of how state laws are written. In Florida, only 21 of the 7,001 nurseries in the state are eligible for licenses to grow medical marijuana.

Factors to Consider

Make sure to check that you have the appropriate permits and insurance if you start a home-based business. Talk to a lawyer so you have a legal structure (i.e. sole proprietorship, LLC) that is right for you. Examine investments carefully to avoid fraud and limit difficulties.

Media discussions about regulations frequently concern federal agencies such as the EPA. However, state and local laws often have a strong impact on business opportunities. As a citizen, make sure you hold politicians pass regulations based on public health and safety, not fear and favoritism.

If You Don’t Drive Much, Save On Car Insurance

If You Don't Drive Much, Save On Car Insurance With This TrickI worked for GEICO for a few years after college, so I picked up some tricks that can help save money on car insurance (link!). But last week, I found a new trick I was previously unaware of and wanted to share with everyone.

Pay Per Mile Car Insurance

I recently found out about a new car insurance company called Metromile. With them, you pay a lower flat monthly rate compared to traditional insurance companies, plus a few cents per mile driven each month. So if you only drive a few miles per day, you can end up saving a lot of money by switching to Metromile. The less you drive, the more you save!

After some conservative calculations, it looked like we’d be able to drop our premium by around $125 every 6 months. That’s a pretty big savings just for switching car insurance companies, so I was prepared to pull the trigger. It would just mean signing up online and canceling my GEICO policy, which at most would take 15 minutes. Save $250 a year for 15 minutes of work once? Sign me up.

Check With Your Current Auto Insurance Company

I called GEICO (our existing auto insurance company) to see if they could match in some way. I switched jobs about a year ago and Lauren cut her commute significantly since graduating from her master’s program. I asked if driving less would qualify us for any additional discounts, and the customer service rep said she could plug in the details and see what that would do to our rate.

We updated our details to go from about 1,500 miles a month down to around just 500 total. With that, our rate dropped by over $100! So in a 5 minute call, we saved $200 per year. Bingo! The difference between GEICO and Metromile wasn’t enough to convince us to switch to a smaller insurer, so we kept our existing insurance, we’ll just be paying a lower rate going forward.

Metromile is a great idea for people who don’t drive much, but if you don’t drive much and are considering a switch to save money, contact your current insurer to see if your rate can be reduced if they have your updated driving data.

As always, it never hurts to ask. By doing some research and making a simple call, the savings can be significant.

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