What you need is a strategy. If you don't have a strategy, it may be because you just don't know where to start and what to include. A few basic concepts are all you need to get started and effectively manage your money.
Create a budget
You have to know how much you are spending vs. how much you earn. Start budgeting by writing down everything you spend each month. Then ask yourself if that is how you want to spend your money. Do you really want to spend as much on restaurants as you do? Are clothing expenditures too high? Make some decisions about your ideal budget instead of simply living with the one you have improvised.
Tip: Look first at your necessary expenses and then look at how you spend your discretionary money.
Manage your debt
You may have included minimum credit card payments in your budget. Think again. Making minimum payments can mean you will take decades to pay off even a small debt. Adjust your budget so that you make more than the minimum payments.
Other types of debt have payments that will pay off the debt in a set time, such as five years. You may not need to make higher payments on those debts.
Tip: You may want to consider consolidating the credit card debt with a loan from the bank and avoid the minimum payment trap. The bank will set a payment amount that can help pay the loan off in a reasonable amount of time.
Adjust your budget to include any additional debt payments you need to make above the minimums.
Plan for retirement
If you have no retirement savings, get started immediately.
Look first for free money. Some employers will match your contributions to a 401K, and some even contribute to a retirement fund whether you pay into it or not.
If you run a business, you may be able to set up a SEP IRA where you can make voluntary contributions. This may reduce your taxes and adds to your retirement savings.
Tip: If your employer does not offer retirement plans, consider opening your own traditional IRA or Roth IRA.
Now go back to that budget and factor in your retirement contributions.
Set aside rainy-day money
Emergencies happen, and unforeseen expenses arise. You must set aside enough money so that sudden financial needs don't derail your budget.
Rainy-day money can be a challenge. It seems like something always comes up to prevent you from setting aside this type of money. You have to discipline yourself to save a little each month. Start small and it will grow.
Tip: Ideally, you should have enough saved to cover your living expenses for six months to a year if you lose your job.
Get insurance coverage
You can't save enough money to cover the kinds of events that insurance will cover. Most financial professionals agree that at a minimum, you need life insurance, health insurance, auto insurance and homeowners insurance. You may want to worry about things like long-term care insurance and disability insurance after you get the basic coverages in place.
All of these cost, in the form of monthly premiums. It's time to add those premiums into your budget if you haven't already.
Tip: Some employers offer free life insurance that equals one year of your salary. Look into it at work.
Fund your dreams
Take your dreams seriously. If you want to travel, send your kids to college or buy a boat, you must save money to make those dreams come true. Admittedly, you can't short your bills to save for a dream, but you can recognize how much those dreams will cost. Gather some figures and estimate what you will need to invest or save to reach your dreams.
Tip: Open a separate account from all of your others and deposit loose change and any bills you have left the day before payday. This can help fund your dreams.
Take care of your heirs
Look into wills and trusts. Both offer ways to pass on your assets to your loved ones. The good news is that these instruments usually only involve a one-time cost, so you won't have to add to your monthly budget.
Tip: Make sure all of your documents are updated with the proper beneficiaries. This includes retirement accounts, insurance policies and life insurance papers.
What you can do next
It's easy to find your budget growing well beyond monthly expenses. But don't panic. Instead, take your finances piece by piece, make a plan, and stick to it. Always remember you have options. if you face your finances head on, you can make rational decisions about the money moves you need to make.