A 5-Day Plan to Improve Your Financial Life
You can improve your financial life by accomplishing small tasks over time. Try this 5-day plan to quickly improve your personal finances and get on the path to success.Â
Laura Adams, MBA
Sometimes the only thing preventing you from improving your personal finances is having the time and motivation to finally get started. Maybe you’ve heard about an easy way to save money or know that you need to review your retirement savings, but you’ve just been too busy to follow through.Â
A 5-Day Plan to Improve Your Financial Life
- Day #1: Set your financial intention.
- Day #2: Create a spending plan.
- Day #3: Automate your retirement savings.
- Day #4: Review your credit reports.
- Day #5: Shop your services.
Here’s more detail on a 5-day plan to improve your financial life.
Day #1: Set your financial intention.
Set financial intentions or goals that will inspire you to work hard and make necessary spending sacrifices.
If you’re not sure what your goals should be, block out an hour by yourself or with your partner to create them. Start by considering the answers to these questions:
- What do I want my financial life to be like in five or ten years?
- What about my (or our) finances worries me?
- How can I build financial safety nets to eliminate stress?
What you want to achieve with your money should be customized to your situation—but here are a few examples:
- Build an emergency fund of at least $1,000.
- Contribute at least 15% of my income to a retirement account.
- Pay off high-interest debt.
- Save for a home down payment, vacation, or holiday gift fund.
Day #2: Create a spending plan.
Start by looking at your expenses over the past few months and see where you can cut back. Maybe you can shrink a large expense, such as your housing. For example, downsizing your apartment or renting out a room in your home could save money.
Or you might be able to eliminate several smaller expenses, like cable TV, dining out, or a gym membership. By creating a simple spending plan, you can begin to take control of your finances.
Day #3: Automate your retirement savings.
Participating in a retirement plan at work, such as a 401(k) or 403(b), is a great way to make sure you’re consistently saving for retirement. But if you don’t have workplace benefits or if you’re self-employed, there are other options.
Everyone with earned income can have an Individual Retirement Arrangement (IRA). You can set up an automatic monthly transfer from your bank account to an IRA.
Don’t think of saving for retirement as something you do only when you have money left over each month. Instead, make it a non-negotiable amount that you always pay, like a bill payment to yourself. Â
Day #4: Review your credit reports.
The health of your credit influences many aspects of your financial life—such as your insurance costs, utility account deposits, and the rates of interest you pay on loans and credit cards—so give it a checkup at least once a year.
It’s free to review your credit report from each of the three national credit agencies every 12 months. Make sure to dispute any errors at annualcreditreport.com.
Day #5: Shop your services.
Consider how you can cut back on expenses you pay every month, such as cable TV, Internet, and wireless service. Take the time to shop online for cheaper auto insurance or find a high-yield savings account to make your money work harder.Â
To sum up, these are just a few tasks you might tackle during your 5-day improvement plan. Also consider selling unused stuff, asking for a raise at work, and subscribing to a financial podcast to improve your financial life.
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Spring Field image courtesy of Shutterstock
About the Author
Laura Adams received an MBA from the University of Florida. She’s an award-winning personal finance author, speaker, and consumer advocate who is a frequent, trusted source for the national media. Money-Smart Solopreneur: A Personal Finance System for Freelancers, Entrepreneurs, and Side-Hustlers is her newest title. Laura’s previous book, Debt-Free Blueprint: How to Get Out of Debt and Build a Financial Life You Love, was an Amazon #1 New Release. Do you have a money question? Call the Money Girl listener line at 302-364-0308. Your question could be featured on the show.