Do you always find yourself scrambling for money at the end of the month? Do you feel that you never have enough money despite earning well? Do you find yourself getting anxious every time you think about your financial future? If you have answered yes to all these questions, you need to streamline your financial planning. Having a good financial plan in place won’t just ensure a financially stable future but also help you determine if you need to apply for a personal loan or not in order to overcome any financial issues.

Listed below are six financial tips that everyone must follow for a better financial future.

Budget Carefully

Budgeting is the most efficient way to keep track of where your money is being spent. It helps you prioritize your financial resources and determine if you are living within your means. It maps your expected income, fixed finances like mortgage, rent or loan payments, what you plan to set aside for savings and the amount available for miscellaneous purposes. Budgeting helps you stay on the financial track.

Have an Emergency Fund

An emergency fund which should ideally be six months of the required household spending if only one person is earning or three months of required household spending if it’s a dual income household. If there is any volatility with the income sources, it would be ideal to increase the number to nine or twelve months of required household spending. In case you face any emergency and don’t have the funds, you can apply for a personal loan. Even if you would like to take up a home renovation project, try not to dig into your emergency fund, instead apply for a home renovation loan.

Review the Insurance Coverage

Review all your insurance coverages — home, auto, liability, etc., to ensure that you are not overpaying. Check if you can drop some deductibles and save on premiums or if you are paying for unnecessary features in your policy that you don’t need. Compare various insurance companies periodically to see if someone else is providing a better deal or competitive prices and make the switch if it seems sensible.

Review Retirement-Plan Contributions

Review the retirement-plan contributions. If you were unable to contribute to your 401(k) plan at work that allows you to get the maximum employer match, check if there is any opportunity to ‘catch up’ before the year-end so that you avoid missing the money. Additionally, increase the IRA contributions if you haven’t reached the limit for the year in order to take full advantage of the present year’s opportunity to put away retirement savings dollars for tax-deferred growth.

Review the Investment and Tax Strategies

Check if your investments still align with your risk tolerances and financial goals. There is a good possibility that the values of the stocks, bonds, etc., changed over the past year and moved the relative weights away from what best meets your needs. Consult with a qualified financial advisor if you need to rebalance your investments or not.

Review your tax strategies as well. If you expect your tax bracket to rise or fall in the current year, consider opportunities to accelerate deductions into the current year or postpone them to the next year.

Automate Savings

Technology can be your friend, so leverage it the best you can. There are numerous financial apps and technological tools that can efficiently help you automate your savings. When you automate the savings, you will be forced to save first and spend whatever is left — which is essential to growing wealth.

It is critical that you live within your means and avoid buying stuff that you don’t need. Focus on the future rather than mulling over the past or just prioritizing the present. The financial health depends on how financially organized you are, understanding the risks you can take and tackling the financial goals over time with financial planning.

Author Bio: Shiv Nanda is a financial analyst who currently lives in Bangalore and works with MoneyTap, India’s first app-based credit-line. Shiv eats, breathes and sleeps finance, to the dismay of friends who’ve endured unsolicited advice on their investment choices, budgeting skills, or lack thereof. Luckily for them, Shiv has diverted this energy toward writing about various financial topics online. He loves it when people actually ask him for advice, so email him your questions at [email protected]. He’ll try not to get carried away with the answers!

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