She Strengthens

Mastering Your Finances Without Losing Your Mind

As someone who has spent years creating content around personal finance, I’ve come to realize that managing your money is an ongoing process. Even with a comfortable income, it’s essential to stay on top of your financial decisions to achieve long-term goals. To avoid financial stress, I’ve developed a system that allows me to stay in control without obsessing over my budget.

Creating a Flexible Budget

Each month, my husband and I review our discretionary budget to adjust for changing expenses. We don’t recreate our entire budget from scratch, but instead, focus on allocating funds to different categories based on our upcoming plans. This helps us anticipate and prepare for expenses, ensuring we don’t have to worry about them later. We use credit cards for most purchases, maximizing points while paying off the balance in full each month. By tagging purchases by category, we can easily track our spending.

Automating Investments for Peace of Mind

Investing can be overwhelming, but it’s crucial for long-term financial security. That’s why I use Wealthfront, a robo-advisor that creates a personalized portfolio based on my risk tolerance and goals. By automating my investments, I can “set and forget” my strategy, knowing that Wealthfront’s software is constantly monitoring and adjusting my portfolio to minimize risk. With a low annual management fee of 0.25% and no minimum balance requirement, Wealthfront is an accessible option for anyone looking to start investing.

Sinking Funds: A Safety Net for Recurring Expenses

To cover larger expenses like travel, annual fees, and gifts, we use a sinking fund. Each month, we set aside a fixed amount into a dedicated savings account, which we can draw from when needed. This approach helps us anticipate and save for recurring expenses without creating a specific savings plan. By automating these transfers, we ensure that we’re always prepared for upcoming expenses.

Maintaining a Cushion in Checking

Leaving a buffer in our checking account provides an added layer of security. We ensure that there’s always a few hundred dollars available in case of unexpected expenses. This peace of mind is invaluable, and I recommend maintaining a buffer if possible. I review our checking account regularly to ensure the buffer remains at a comfortable level.

Monitoring Progress and Staying Motivated

Regularly reviewing our net worth helps me visualize our progress toward our long-term goals. Seeing our debt burden decrease and net worth increase motivates me to continue making smart financial decisions. It’s essential to acknowledge the small victories along the way to stay motivated.

Staying Accountable with Credit Card Statements

Reviewing my credit card statement each month helps me identify areas for improvement and detect any potential fraud. By combing through my statement, I can reflect on past purchases and make more intentional decisions about my spending.

By incorporating these habits into my monthly routine, I’m able to stay on top of my finances without feeling overwhelmed. With Wealthfront, I’ve found a reliable partner in my investment journey. If you’re ready to take control of your finances, consider opening a Wealthfront account today and get your first $5,000 managed for free!