Money Made Easy: 3 Steps to Feel More Confident With Your Finances

Managing Money Doesn’t Have to Be Overwhelming

Money can seem scary, but it doesn’t have to be! According to the World Economic Forum, Financial Literacy rates in the US hover around 50%. With numbers like that, it is understandable why thinking about money can be stressful. While I’ll save my argument about why financial literacy should be included in the American education system for another day, it’s clear that simplifying finance is a good first step toward building financial literacy. So, if thinking about money stresses you out, you’re not alone! Fortunately, there are steps you can take to build confidence in your finances. Here are 3 small steps you can take to feel more confident with your finances. Please note that these steps are based on my personal experiences and should not be considered professional financial advice.

Step 1: Reveal Hidden Expenses

When is the last time you have reviewed your finances to see where money is going? Last month? Last year? Never? Reviewing your spending can provide insight into your spending habits and reveal hidden expenses you didn’t know you were throwing money at.

For instance, many businesses work with subscription models, and you might be paying for a subscription without realizing it. This can add up over time! Identifying and canceling subscriptions you no longer use can save you significant money over a year.

While looking at one month’s worth of finances is helpful, I suggest looking over three months to see if you can find patterns in your spending. 

If you want to dive deeper, look at some of your larger expenses, such as insurance, over the course of a year. Have the rates increased? If so, is it worth getting estimates on new insurance policies? It can be time-consuming but can save you money in the long run. I try to do this every 1-2 years. Sometimes I can find savings, sometimes I can’t, but it is always worth the effort.

Step 2: Start an Emergency Fund

If you’ve read previous posts, I might sound like a broken record about emergency funds. It is important to have money readily available in case the unthinkable happens. By opening a high-yield savings account for your emergency fund, you are taking a proactive step to be in control of your finances, which can be empowering.

If you completed the previous step and canceled any old subscriptions, consider directing those monthly savings to your emergency fund through automatic transfers. Since you were already spending that money on something else, you won’t feel the hit, and you can boost your confidence by building a safety net for yourself. It may take time to save the amount you need, but knowing that you are doing the work is a huge confidence boost!

Step 3: Automate to Reduce Stress

Again, I sound like a broken record, but automating some of your finances can reduce stress. If you have a steady income every month and feel confident that cash flow will be consistent, automating some payments and savings can reduce your workload and alleviate some anxiety about money. Do you ever wake up in a cold sweat in the middle of the night wondering if you paid this month’s water bill? Automation can help with that. Set up an automatic draft from your bank account, and then you know that your water bill will be paid on the 15th of each month (or whichever date you choose). You can also automate savings by setting up automatic monthly transfers to your emergency fund, any investment accounts you have … anything you want, provided you know you have the income to cover it.

Starting Small Builds Confidence

By taking these small steps, you are taking an active role in building your financial wellness. If you continue to monitor your finances and periodically check in with them, you will progress toward your financial goals, whether it’s saving for a vacation, buying a home, or planning for retirement. This will build your confidence, allowing you to take even bigger steps toward financial wellness over time. Celebrate the small wins to build confidence and empower you to achieve your next big thing!

Need some help building your confidence? Schedule a free consultation with Gentle Fearless Coaching and Consulting to see if a Confidence Coaching Package is right for you!

*This article is for informational purposes only and should not be construed as specific advice or a substitute for professional advice from a qualified financial professional. I am not an accountant or financial advisor, and information on this site is not a substitute for information provided by a professional familiar with your situation or unique needs.