Are you among the 65% of Americans being kept up at night by money worries? Managing your money can definitely be overwhelming, especially with so much conflicting advice out there.
The good news is, you don't actually have to do much to get your finances under control. You just have to follow a few simple rules to streamline your spending and tackle all of your biggest money issues.
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Here are five basic financial rules to live by that will change your life and put you on the path toward a more prosperous future.
1. Spend less than you earn
More than 3/4 of full-time workers were living paycheck to paycheck in 2017, and 71% of U.S. workers were in debt according to a CareerBuilder survey.
Unfortunately, it's impossible to ever get ahead if you're spending as much -- or more -- than you're bringing in. To be able to save, you must have money left at the end of the month. This means you need to either increase your income or reduce your spending.
Boosting your income could come from asking for a raise, doing overtime, taking on side gigs, or starting a new business. Spending less than you earn usually requires tracking your spending, setting a budget, and sticking to self-imposed spending limits.
Or, to force yourself to spend less than you earn without hassling with a budget, automate your savings and have money withdrawn directly from your paycheck before you ever see it. You can't spend what you don't have. Just don't get out the credit cards to make up the difference!
2. Institute a 24-hour rule for big purchases
More than half of all respondents to a 2013 CreditDonkey survey reported regularly feeling guilty after making purchases. Spending a lot of cash on something that doesn't bring joy to your life is a waste.
To stop the guilt and make sure you're getting your monies worth out of every buy, institute a waiting period of at least 24-hours before you make a big purchase. Your definition of a "big" purchase will vary depending upon your income. Around $100 is a good number for many families.
The 24-hour waiting period gives you time to think about whether it's really worth such a big outlay -- do you really need that new iPhone or is there something better you could do with all that money?
A waiting period also gives you time to shop for a better deal. If you can't get the item out of your head and decide to purchase, you may save a few bucks anyway.
3. Get on the same page with your spouse
Money is the number one cause of relationship stress. Not only does fighting about money make it hard to get along with your spouse, but it also makes it difficult to accomplish financial goals. If you're trying to save or get out of debt and your spouse is hitting the mall, you'll never get ahead.
To ensure you're on the same page, set aside time for regular money talks. Agree on the big stuff, like how much you want to save and what your big financial goals are for the future -- then find ways to work together to achieve your plans.
If you're constantly fighting about spending, it may be best for each spouse to have a separate account with a mutually agreed amount of "fun" money. Make a deal that once the money is gone, spending will stop.
4. Save for a rainy day
Emergencies absolutely are going to happen. In fact, 60% of Americans responding to a 2015 Pew Survey indicated they'd experienced a financial shock during the prior year and the median cost of the most expensive financial shock was $2,000 for these households.
Unfortunately, almost 60% of Americans don't have $500 in the bank to cover an emergency, and more than half of all households reporting a financial shock still hadn't recovered their financial equilibrium six months later.
If you don't have rainy day savings, you'll perpetually end up in debt when you have to put your emergencies on a credit card. This will derail repayment efforts and make saving harder.
An ideal goal is to save enough cash to cover around 3-6 months of living expenses. If that sounds insurmountable, start with saving a little money each month until you have at least $1,000. You can grow your emergency fund over time, but at least this will cover most financial disasters without sending you reaching for your credit cards.
5. Prioritize your retirement savings
Even if you don't follow any of these other rules, this is the big one. You absolutely must save for retirement.
You cannot live on Social Security alone. Unfortunately almost half of all American families have nothing at all saved for retirement, according to the Economic Policy Institute. Once you cannot work any more, there will be nothing you can do -- so you need to act now.
Before paying for anything else other than the most essential bills, divert a portion of your paycheck toward a workplace 401(k), an IRA, or other tax-advantaged retirement account. Ideally, you should try to work up to saving at least 15% of your income, but start with whatever you can spare. Aggressively increase your savings -- including diverting your raises to your retirement funds -- until you've reached your savings goal.
Managing money is easy if you follow these five simple rules
Living by these five golden rules of money management is easier said than done, but if you can pull it off, the rewards are worth it. A happier marriage, more financial security, and the ability to stop worrying about money are benefits that will pay big dividends once you get your financial life under control.
This article originally appeared on The Motley Fool.