Connect with us

Hi, what are you looking for?

Best Practices

How to Manage Your Money Better in 2020

The new year is a perfect time to get your finances in order. Check out our top tips on how to manage your money in 2020 and start a path to financial wellness next year.

A brighter financial outlook might be on your wish list for 2020–but if you’re like many people, achieving that milestone is easier said than done. Learning how to manage your money better is a matter of setting a plan and sticking to it–whether you’re looking to pay off debt, save for a major expense like a summer vacation, or simply ease up on your spending. On the path to your financial makeover, here are our top proven tips for how to manage your money better in the new year.

1. Create a Budget

A budget is the single most valuable tool for creating healthy financial habits. Start by cataloging your current expenses according to the category, such as rent, utilities, food, entertainment, insurance, and hobbies. When you compare your budget to your monthly income, determine how much wiggle room you have and where you can afford to trim some expenses. Even ditching the daily latte or bringing a homemade lunch to work can free up some room in the budget. Keep updating your budget regularly throughout the month and adjust as needed. Reviewing your budget regularly will help you figure out how to manage your money most effectively.

2. Track Your Spending

If you think you might be spending excessively on items you don’t really need, challenge yourself to track your spending.  Write down everything you spend money on for a week (or more, if you like). The exercise will force you to take a hard look at your purchasing decisions and evaluate what you actually need. You can use a personal finance app like Mint to simplify the tracking process on the go. Another option is withdrawing a certain amount of money in cash per week for entertainment, dining, and other miscellaneous expenses—and only allowing yourself to use cash for those purposes.

3. Set Aside a Portion for Savings

Each week or month, set up an automatic recurring transfer to a savings account. It’s a good idea to have at least six to nine months’ worth of expenses set aside in an emergency fund account. That way, you won’t have to worry about borrowing money or racking up credit card debt in the event that you lose your job or you need to pay for your pet’s unexpected surgery. Once you have a solid emergency fund, create a separate savings account for more exciting future adventures — such as that long-awaited vacation. Aim to save at least 10-15% of your income, but it’s OK to start smaller with what you can afford.

4. Consolidate Credit Card Debt

If you want to learn how to manage your money, addressing your credit card debt is essential. Instead of paying off your credit card gradually over time at increasingly higher interest rates, consider taking out a low-interest personal loan through a lender such as Prosper. You’ll be able to lock in the interest rate over the entire loan period, typically either three or five years. That way, you can shorten the overall time it takes to pay off your debt and—most importantly—save yourself money.

5. Talk to a Financial Planner

If you find yourself spinning your wheels as you try to overhaul your finances, consider hiring a financial planner. Financial planners work with directly clients to help them realize both short and long-term financial goals. They’ll be able to evaluate your income and expenses and design a plan to help you manage your money more efficiently in 2020 and beyond. Building a stable foundation for your future could be well worth the initial upfront investment.

Read more

Join our mailing list


Person checks their FICO Score

Credit Score Information

Most adults in the United States have at the very least, heard of a FICO® Score. However, most lack knowledge of the nitty-gritty of...

Woman looks up credit report compiled by the three credit bureaus Woman looks up credit report compiled by the three credit bureaus

Credit Score Information

You’ve probably heard a lot about the three credit bureaus, but many Americans aren’t sure exactly what they are. That’s OK because Prosper’s got...

MAn applies debt snowball strategy to his finances MAn applies debt snowball strategy to his finances

Credit Management

There are several common strategies to address personal debt, but one of the most well-known is the debt snowball strategy. Today, we will look...

Investor Center

Today we are sharing performance data from the Prosper Portfolio for March 2022. Highlights from the Prosper Performance Update – March 2022: Performance Update...

Ways to Save Money and the Environment Ways to Save Money and the Environment

Financial Lifestyle

There are many easy ways to save money and the environment in our everyday lives. From the laundry room to the mailbox, the grocery...

Credit Management

With another year behind us, we find ourselves in tax return season once again. While 2021 did bring back some semblances of stability and...

You May Also Like

Financial Literacy

April ushers in National Financial Literacy Month at a time when statistics show that most of us could use a refresher in financial education....

Credit Management

If you are like the majority of Americans, you have a mound of debt that you are eager to pay off. In fact, the...

Financial Lifestyle

Do you have a nagging travel itch that just won’t go away? Perhaps you daydream of sitting poolside in Fiji, but your bank account jolts...

Best Practices

Individuals and communities have increasingly become “Earth conscious,” making heroic efforts to save our planet from climate change, deforestation, pollution and other threats. While...