A Guide To Taking Control of Your Financial Future

Whether you’re a business owner or about to head to college, it’s never too late or too early to start taking control of your financial future. 

This requires you to be strategic with spending your money and consider investment and saving options. 

Here are five personal finance strategies you can implement to take control of your finances to help you plan—and save—for the future.  

1. Stick to a Budget

Budgeting is one of the most essential strategies. As a business owner, you must maintain a budget for your business and personal spending. As an individual, you should also track how much money you have coming in and your expenses. 

It cultivates the habit of planning for the future, whether regarding business expansion, personal milestones, or unexpected contingencies. Furthermore, a well-structured budget promotes accountability, encouraging a continuous review and adjustment of financial strategies in response to evolving circumstances. 

2. Make Smart Investments

Investing can seem daunting, especially for beginners. Luckily, a couple of investment options are easy to get started with. 

High-yield savings account

Those nervous about investing in assets can open a high-yield savings account (HYSA). These accounts have a high annual percentage yield (APY), meaning you will get a decent return on your money without investing it. 

Mutual funds

A mutual fund involves purchasing shares that represent ownership in a diversified portfolio of investments. The fund manager decides where the money is invested. 

The benefit of a mutual fund is that all your money won’t be locked in a single investment, which helps to diversify your investment portfolio.

Stocks

Once you become more comfortable investing and trading, you can invest in individual stocks. This form of self-directed trading allows you to identify which stocks to buy and when to sell them. 

If you buy a stock at the right time (like when a new business is starting to show potential), you can grow wealth and secure your financial future. 

Short-term certificates of deposit

A certificate of deposit (CD) is another kind of savings account with a high APY. A CD works as follows: You deposit money into the account for a certain period. You cannot access your money during this period unless you’re willing to incur a penalty. 

Once the period expires, you can withdraw your money or reinvest it in a new CD. CDs range from six months to five years—the longer the time, the higher the APY.

Money market account

A money market account (MMA) is a low-risk savings account. It offers a higher APY than a traditional savings account, plus you get a debit card to access your funds. 

Shop around at different banks to check out the MMAs that they offer. This strategy will help you get a good deal with a high APY account. Note that some accounts have penalties if you withdraw a certain amount early. The penalty is most often lost interest.

3. Pay Off Debts

This may seem obvious, but many people don’t consider paying off debts essential to securing their financial future. To start planning for your future, you must first pay off any outstanding debts, like car loans, student loans, and credit cards. 

Your credit score may suffer if you have plenty of debt, making it more challenging to take out loans in the future.

By prioritizing debt repayment, you lay the groundwork for a more robust financial foundation. This proactive approach frees up resources and positions you to make better decisions about savings, investments, and other aspects of future planning. 

It's a solid financial base upon which you can construct your aspirations and long-term goals. So, addressing and settling outstanding debts is an essential first step before charting your future endeavors. 

4. Start an Emergency Fund

Whether you need to replace your car’s tires, pay an unexpected medical bill, or lend money to a loved one, setting aside some money is always a good idea.  

Emergency funds can prevent you from going into debt or having to apply for high-interest loans to cover unplanned expenses. 

5. Sort Out Your Retirement Savings

When you’re still young and just starting your career, retirement is the last thing on your mind. As soon as you start earning money, you should also begin planning for retirement. 

If you’re lucky, your employer may contribute to a retirement fund or your 401(k) plan, or you may have to use your income to get started. It’s best to talk to a financial advisor about retirement savings plans.

Conclusion

Thinking about the future and how to remain financially savvy can be daunting. There’s no better time than the present to get started. 

With many investment options at your fingertips, you can start planning for your future now. Whether you want to save money to start a business or simply have cash aside for a rainy day, a financial plan can align with your goals.