How To Become Financially Savvy
- Being financially savvy means understanding your money while preparing for your long-term financial goals.
- Money is a tool that helps to get you what you want and need out of life.
- CapWay has tons of information and resources to help you on your money journey.
Becoming financially savvy is no small feat. It's a big challenge to undertake, but with the right tools, you can succeed in it in no time. Below you will find tips to help you on your money journey to becoming a financially savvy person.
Habits Of The Financially Savvy
Psychology of Money
The number one habit of financially savvy people is understanding the psychology of money.
The psychology of money goes back to when we were kids. We learned from watching our parents manage their finances and picking up on what society has thrown at us over time. When you understand how money works, you will better understand what to do with your money.
Money is a tool that helps to get you what you want and need out of life. So whether you need to pay bills or want a new car, money will help you get what you desire.
Your Relationship with Money Matters
Someone who is financially savvy will have a good relationship with their money.
Having a good relationship can mean learning how to separate your emotions from your money. When you separate your emotions, you tend to make better financial decisions.
If you are constantly stressed out about money, it’s crucial to find the root issue of your money stressors and figure out a solution.
Identify your problem areas regarding money. Then, write down those problem areas and research ways that can help you to find a solution. For example, if you are an impulse shopper and want to do a better job at saving more money, research “saving tips” on the CapWay website and take 2-3 tips and apply them to your life. This will allow you to gain a better relationship with yourself and your money.
Pro Tip: CapWay has tons of information and resources to help you on your money journey. Read through our Learn Money page to learn more about a specific money topic. To request money-specific content, click here.
Put Yourself First on Payday
Another habit of the financially savvy is that they immediately pay themselves first on payday. When you hear of people paying themselves first, that typically means they are saving a portion of their money from their paycheck.
Automating a certain amount each payday to go towards your savings account is critical. In addition, saving money can help prepare you for major expenses in the long run, like putting a downpayment on a house or buying a new laptop.
Set Money Goals
A budget can help track your spending, saving, and investing goals. Even when you lack the discipline to save or invest, a budget will help keep your finances in check. A budget gives you power over your money and allows you to give every penny a job that can include saving, investing, or building your emergency fund.
Pro Tip: Sign up for a CapWay debit card to create and save toward your money goals.
A successful budgeter will also set money goals. Your money goals can aid you in working toward a specific objective. For example, if you have a goal to become financially free, then you must make a step-by-step plan. Within your plan, you may include paying off your student loan debt, saving, and investing a large sum of your money every time you get paid.
Furthermore, by setting financial goals, you must work hard to achieve them. You will feel extremely good about yourself once you meet your goal.
Share Your Story
Money is often deemed a taboo topic. Talking about money is hard for almost anyone to open up about. So take the initiative to be the first in your family or friend group to share your money story.
Sharing your money story with friends allows a safe space to discuss any money issues, failures, or wins. In addition, life becomes less stressful when you surround yourself with people who only want the best for you.
Your story could be the catalyst to changing another person's life for the better. In addition, you may share some valuable tips that have helped you along your money journey and could potentially positively impact someone else.
Learn Money from CapWay
Personal finance isn’t a fun topic, but there are ways to make it more interesting. CapWay’s Learn Money page has tons of information to guide your finances in the right direction.
You can learn and digest CapWay’s content in several ways, like through a video, articles, and infographics. Reading articles or watching videos can be financially rewarding and less time-consuming.
Whatever money topic you’d like to learn about, CapWay has the information you need. Also, if you don’t see what you need, you can request the content you want, and the CapWay content contributors will create the content you need.
Join a personal finance group. Ask the group members questions, and don’t be afraid to share your story or listen to others' stories within these groups. Another way to connect with people on a similar money journey is to attend conferences and brunches in your local community.
The key to networking is to diversify your network and circle of friends. By networking, you are leaving your comfort zone to grow in certain areas of your life. Surround yourself with a diverse group of people whose goals align with yours, like building generational wealth, learning about financial freedom, or finding new ways to increase your income while working from home.
Diversity helps increase the number of people you interact with that have different money stories. When listening to various money stories, you can see a glimpse of another person’s life from their perspective and learn something new and valuable.
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The Money Wrap-Up
It is never too late to become financially savvy. It may feel like your debt number is so big that it is impossible to pay off but don’t let that intimidate you. Instead, organize your finances and create a list of goals to begin your money journey.
Education is the key to becoming financially savvy. Once you start learning and growing on your money journey, pass the information to others. Sharing your knowledge can help someone else pay off debt, invest their money, and ultimately build wealth.
Recommended Read: 5 Ways To Celebrate Financial Literacy Month
If you need additional financial help, contact a certified financial planner or advisor. A financial advisor can assist you with learning about money while also helping you to manage it.
Finally, don’t beat yourself up over all the money facts and tips you didn’t know before. Instead, extend yourself grace and start where you are. Remember, the most critical first step is getting started.