Neighborhood Credit Union

Smart Money Moves You Need to Make and Some You Need to Avoid

By Jordan Ottaway


Making smart financial decisions is important at every stage of life. However, learning how to spot the good from the bad early on is even more important. The longer you practice smart money management, the better you’ll be at it.

With so many different money-saving tips available online, it can be difficult to find ones that actually work. I want to pass along some money moves I’ve done that have actually helped better my personal finances early in my adulting career.

Set up that emergency fund

This is a big one.

You never know when something is going to go wrong, so it’s well worth your time and effort to put together an emergency fund to cover yourself against the unexpected. Knowing you can cover an unexpected expense will give you peace of mind and won’t compromise other financial goals you may have.

You can even “set it and forget it” by having an automatic transfer from another account. If you commit a certain amount each month you will be surprised to see how quickly it can add up. And you’ll be happy you did when you actually need to use it.

Getting your emergency fund is something you don’t want to wait to do.

Seek out financial knowledge

Thinking you know it all is annoying and can end up costing you a fortune. Life never stops teaching, so there is still a lot out there for us all to learn.

Making the decision to get involved with your finances and broaden your knowledge is one of the most beneficial decisions you can make. Don’t be afraid to ask questions, scan personal finance blogs, and read books. Knowledge is power and you want to make sure you have power over your finances and your future.

Reduce, or eliminate, monthly bills

Bills eat up a lot of your paycheck. Think of all the bills you pay each month and take out the ones that you don’t really need. How much would you save?

If you don’t want to cut out certain services, learn how you can reduce your cost. For example, if you have cable and only watch certain channels, look into online streaming services that are a fraction of the cost. It’s all about paying attention to your spending habits so you can spot ways to maximize your cash flow each month.

I did this and saving $70 every month doesn’t make me regret it one bit.

Now the negatives…

I feel like I need to talk about some common “money-saving” techniques people use that are actually costing them more in the long run. They may sound good at first, but you should probably just avoid them.

Don’t skimp on groceries

It may seem like you’re saving money by not buying everything you want when you go to the grocery store, but you’re actually putting yourself at risk to spend more and waste food. When you don’t buy enough food or food you don’t really want, you can’t make a satisfying meal at home. That means you are more likely to cave and go out to eat. I hate to admit it but I’ve been guilty of this many times.

Spending money on groceries you’ll actually use might be a little more expensive, but you will make healthy meals and save more money in the long run.

Don’t have weak insurance coverage

We can all agree that insurance is expensive. More and more people, especially those under 30, are cutting down on their coverage because the monthly payment is lower. That isn’t really saving you money.

There are insurance plans out there that have a low monthly payment but a high deductible. Some plans have a deductible as high as $6,600 for individuals and $13,300 for families. If something happens, you end up paying a lot more than if had you been paying more every month.

Don’t be too strict with your budget

Having a budget is great and is definitely recommended, but when you don’t give yourself room for error, you’re setting yourself up to fail. Think of this as the financial version of a very ambitious diet. You might stick with it for a week or so, make a mistake, then end up quitting it entirely. This is why so many budgets fail.

Instead of cutting yourself off cold turkey, leave room for error and change. Gradually eliminate things from your budget and give yourself time to adjust. It will greatly reduce the chance of you falling off the wagon and binge-spending.

Here’s to a strong and successful financial future.