If you’re like many Americans, having a better understanding of money management is a priority for you right now. In fact, nearly 75 percent of Americans hope to improve their financial literacy this year, according to a survey conducted by OnePoll for World Finance. The same survey also found that 50 percent of Americans need advice on how to budget properly.
“While money matters can seem overwhelming at first, there is a simple formula for successful personal finances—know your credit score, create a manageable budget and build your savings,” says Chad Prashad, president and CEO of World Acceptance Corporation, the parent company of World Finance, a personal finance company.
To help you get started, World Finance, which helps over one million customers each year improve their financial situations, is offering the following tips and insights:
1. Know your credit score: Many banks and lenders will let you review your credit score for free on a regular basis. If your credit score has room for improvement, a simple way to build it is through a credit-building loan. This is a small loan designed to be easy to pay back, helping you establish positive credit through the lender. When taking out a loan, always be sure to use a reputable lender that reports to credit bureaus so that repaying your loan positively impacts your score.
2. Make, and stick to, a monthly budget: There is no one-size-fits-all way to make a budget so find a method that works best for you. A few systems to try include envelope budgeting (dividing expenditures into physical or digital envelopes representing different spending categories), zero-based budgeting (earmarking every last penny of your income to a useful purpose) and the 50/30/20 Rule (allocating 50 percent of your income to needs, 30 percent to wants and 20 percent to savings and debt reduction).
3. Start saving: While building a savings account can be daunting, it’s important to allocate one in your budget. Doing so will mean you have an emergency fund to keep you afloat when the unexpected happens in life. According to the OnePoll/World Finance survey, nearly 30 percent of Americans do not feel that they have the safety net or resources available to cover a financial setback greater than $400. If you find yourself in a situation where your savings won’t cover what you need, a personal installment loan with equal monthly payments designed to fit into your budget could be a good solution. Find a lender that will work with you to understand the complete picture of your finances, such as World Finance. To learn more, visit loansbyworld.com.
“Every so often, it’s a good idea to take inventory of your financial wellness,” says Prashad. “Use the opportunity to understand your credit score, employ budgeting tactics and create a savings fund.