There are times in all our lives when we want to celebrate an important family event or treat ourselves to a vacation but our pockets just aren’t deep enough. The fact is, when it comes to the good things in life, you need your cash flow to be working in your favor and you can easily do that with good financial management. You can calculate your cash flow by deducting your regular expenses from your overall monthly income and what you’re left with can be spent as you wish. However boring budgeting sounds, there are some really simple ways you can accrue some disposable capital by making small changes you’ll barely notice.
Here we show you how with 7 great tips to improving your cash flow so that you can enjoy your hard-earned money much, much more:
#1 Double-Check your Tax Deductions
It’s always worth making sure the IRS aren’t getting more from you than they’re owed by using the IRS’ withholding calculator and referencing with your paycheck. If you do find that you are paying too much federal and state tax, you can rectify the situation by completing a new W-4 form and giving it to your employer.
While you’re taking a closer look at your paycheck, you can also consider any insurance plans you have taken out that you’re not using or any charitable donations you may want to reduce and see if you can increase your earnings that way. Alternatively, you can ask for extra shifts or overtime or even start a small home business on the side to create an improved income stream.
#2 Trim your Expenses
Although it makes complete logical sense to just spend less to save more, this logic is hard to apply in practice. Take the food you eat for example. After a long day’s work, the last thing you want to do is slave over a hot stove preparing a family meal or even cooking for yourself. This is the time of day when a takeout seems very appealing or at least a ready-meal that just needs a blast in the microwave. Think about investing in a crockpot and making big batches of meals that you can portion and freeze for those times when you just haven’t got the energy. You’ll notice some significant savings in your day to day spend.
#3 Pay off or Refinance Your Debts
Although it might seem ironic to spend more money paying off debts than is required, particularly if you’re saving for a vacation, it can make a big difference to how much disposable cash you’re left with from your paycheck each month. Financing debt is expensive but it is increasingly possible to find flexible lenders or re-financing opportunities that will ultimately save you money by shaving something off the overall interest level for all your borrowing. You can explore other ways of financing your debts by checking out the availability of online loans and find a way to reduce your repayments.
#4 Budget for the Expenses you Know About
We all have regular payments such as rent or mortgages to consider each month and these are the best to budget for in advance. It’s always important to keep on top of the regular expenses as they generally have stiff financial penalties for late payment, which is obviously something you want to avoid. Although you may know what your regular expenses are, make sure you know exactly how much is due and when so that there are no nasty surprises during the month. As soon as you get paid, allocate the exact amount of money you need for your regular expenses and even withdraw it and keep in a jar if you have to.
#5 Re-Examine your Household Budget
On the topic of regular expenses, it’s always worth checking that you aren’t paying too much for something, especially if you no longer need it. Perhaps you have some items covered by your home insurance that you no longer own or there is a more competitive utilities provider you want to switch to. There are several ways to boost your cash-flow when you take the time to inspect your current household budget and personal finance experts recommend you do this at least once a year.
#6 Be Realistic about What You Need
Perhaps you have a Netflix membership you don’t really use or have joined a gym and shamefacedly never turned up? If you enjoy eating out it may seem disappointing to give up this pleasure but it’s another expense that’s not really necessary if you think about it. According to research, the average meal costs $36.30 per person, which is a considerable expense if you like to indulge in fine dining on a regular basis!
#7 Create a Cash Cushion
Alongside saving for that special family occasion or the vacation of a lifetime, it’s also a good idea to create a cash cushion for those unexpected emergencies. Without a crystal ball it’s just not possible to predict what will happen in the future but if you have some money saved specifically for these times, your savings can remain intact.