On the surface, dealing with your money sounds complicated.
Do you need a Roth or traditional IRA? Should you open a 529 in your home state? Do you need an accountant to do your taxes? How much are you supposed to save?
It can be overwhelming, and it’s easy to think you aren’t doing what you’re supposed to.
Chances are, however, that you’re doing better with money than you realise. Take a look at the accomplishments below — and they are accomplishments — to get some perspective on your finances.
The other half of knowing how much you earn is knowing how much you spend. Whether you use an app like Mint, LearnVest, or You Need a Budget to keep track of your monthly spending or you're a die-hard Excel addict, knowing how much money it takes to sustain your lifestyle is key.
Once you know how much you earn and how much you spend, some simple arithmetic will reveal how much you can afford to save, invest, or spend on high-tech headphones.
Bonus points if you've progressed beyond tracking your income and spending to establish a monthly budget. (For tips, check out these real people who keep diligent budgets.)
Pew Charitable Trusts found that 33% of Americans have no savings at all.
If you can cover your necessities, afford things you want but don't need, and stash away funds for the future, you're doing something right.
Experts recommend leaving about six months of living expenses untouched in a savings account to serve as an emergency fund should something go wrong. Bonus points if you have or are building an emergency fund to protect yourself against future disaster.
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