While most Americans believe that they are financially stable, a survey from the Board of Governors of the Federal Reserve System revealed that the economic fragility is still rampant all over the US. Based on the Report on the Economic Well-being of US Households for 2018, 27 percent of adults in the country would need to borrow money to pay for unexpected expenses worth $400. Then another 12 percent would struggle in paying their monthly bills if they incur an extra $400 obligation. But borrowing money to pay for your usual expenses can be considered as one of the major threats in your finances, which can be avoided. You can still make your money last longer by following these clever tips.
Know Your Spending Limits
You can make your money last longer by setting a limit on the amount that you can spend after every payday. You can start by making a budget. List down all the household utilities that you need to pay regularly. This should include home mortgage or rent, electricity bills, transportation expenses, insurance, and the likes. If you still have something left for miscellaneous expenses, you can spend it on eating out or buying a new pair of shoes.
As much as possible, pay in cash instead of a credit card. If you need to use your credit card to pay for bills, make sure that you will pay all your dues on time. Delayed payments will only affect your credit score. If you will pay all your credit card dues, you will have more chances of getting a higher credit score. You may also possibly have a credit card upgrade with a higher credit limit. But if your credit card issuer gave you an upgrade, make sure that you will use it responsibly to avoid spending all your hard-earned money to pay for your balance.
Choose What To Do With Your Extra Income
If you still have money left after paying all your bills, you must resist the temptation of spending it all away for something unnecessary. It would be best if you will put it in a savings account to generate interest. This will also allow you to have a source for emergency expenses. You may also invest in the stock market, in mutual funds, and investment bonds.
Avoid Spending On Impulse
It is inevitable to find something that you have been dying to have on the display rack in your favorite shop. You may even find yourself booking a flight ticket to an exotic destination on a whim after seeing a travel ad online. But before you spend your money on these things, you need to spend some time to consider. By waiting for a while before you make the purchase, you might find lose interest over time. This will save you from paying for any unnecessary expenses.
By making these wise decisions, you can make your money last longer. This will help you avoid living from paycheck to paycheck. Because of this, you will have enough money to put into the savings that will cover you until your retirement.