TIP: Choose a budgeting system that reflects who you are.

If you’re a hyper analytical person, a detailed budgeting spreadsheet might suit you. But if you’re more hands-off, a budgeting app might do the trick. No matter how you budget, it’s important to at least understand the money coming in and going out monthly. “When people see their spending, they have an aha moment, because they didn’t realize where their money was going,” says Sidney Divine, an Atlanta certified financial planner.


Did you know that if you work a contract gig and don’t put aside enough cash to cover taxes, you may be left making monthly payments to the IRS for years to come? In my early 20s, I learned this the hard way. TIP: Locate the source of a problem and find a solution. In my case, the problem was that I ignored my finances and didn’t think about tax obligations. I resolved the issue by proactively managing my budget and paying off my tax debt. Getting a new job that wasn’t a 1099 gig helped, too. “You’ve got to figure out: Is it the same mistake you're making over and over? Is it a pattern?” says Christine Papelian, a certified financial planner in Phoenix. “If it’s a new mistake, then now you have an opportunity to get back on track. It’s almost never too late to change a behavior or a habit.” If you have a habit of making late payments, for example, think about setting up automatic bill pay so you don’t have to worry about tracking various due dates.


The past year has been a crash course in instability. And while recent crises were unusually severe, you can count on unexpected financial challenges to pop up throughout life. For instance, a broken alternator on my car once drained my emergency fund, but at least I was able to avoid going into debt to cover the expense. TIP: Make savings mandatory.



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