A budgeting expert has revealed the five things she has stopped doing to become financially literate in an attempt to help others start off the new year with better money managing skills.
Caitlin Silva, from Toronto, Canada, is a 25-year-old money coach who frequently gives tips on how to become the most budget-savvy version of yourself on her TikTok account.
As cost of living prices continue to soar, and more and more experts are revealing different methods to save – from cash stuffing to snowballing, the budgeting expert revealed the habits she stopped to have a ‘healthier relationship with money.’
From buying home decor to using her debit card, Caitlin explained how five changes helped transform her bank account and make her financially literate.
Caitlin Silva, a 25-year-old from Canada, has revealed the habits she stopped to become financially literate
Home is where the heart is, so ditch the decor! Stop buying trinkets for your home
The money coach’s first tip to form a strong relationship with money was to stop buying ‘home decor knickknacks.’
She said to stop buying ‘home decor knickknacks’ and keep sentimental items instead
She explained that items such as ‘statues, vases and house decorative pieces that we buy to finish off a space’ are a waste of money.
Although Caitlin said it was ‘so easy’ to buy small items to enhance your space, ‘especially when you move,’ she explained that you should leave these items on the shelf.
The budgeting expert added that if you are not ‘in love’ with these products, they can just add ‘meaningless clutter to a space’ while putting a dent in your wallet.
And if you can’t help yourself when it comes to leveling up your space, Caitlin even gave viewers a tip for how to decorate without breaking the bank.
She explained that the items you often see at stores are usually ‘trendy’ items that you will more than likely ‘get sick of,’ so, you should wait for ‘sentimental’ trinkets to ‘come into your life.’
Caitlin added that these could be souvenirs from trips or items that have been passed down by your family.
She noted that not only will this practice help break a bad money habit, but when you look at the items, you will no longer see just a ‘thing,’ but will think about the ‘people or memory associated with it.’
Don’t buy cards or gift wrap at the same store you bought from
For her second savvy tip, Caitlin gave a tip for gift-giving
For her second savvy tip, Caitlin gave a tip for gift-giving.
She said you should never purchase gift wrap or cards at the same store you buy a present from if you are looking to stay under budget.
‘Typically at these stores, the gift cards or wrapping paper are so much more expensive,’ she explained.
The money coach added that purchasing these items at the same store can also put you ‘over budget.’
‘It can really put you over budget for the gift you’re buying,’ she explained.
She suggested that instead, viewers should save money and go to dollar stores when looking to purchase gift wrap or cards.
Bookworms beware! Don’t buy every book you want to read
She suggested renting eBooks through an app called Libby, which is free
Her next unique, yet helpful, hack is one that may be hard for the bookworms out there as she recommended viewers avoid purchasing ‘every book’ they want to read.
Caitlin explained that the costs of books has ‘escalated throughout the years,’ which is not helpful when working towards your financial goals.
She added that ‘the readers get the struggle’ of desperately wanting to buy every book on the shelf, but being tight on money.
As an alternative method to splurging on physical books, Caitlin revealed she tries to ‘rent eBooks’ through her local library to help cut down costs.
She suggested renting eBooks through an app called Libby, which helps users borrow eBooks, audiobooks and magazines from their local library without even spending a dime.
Caitlin added that when it is not available through the app, she buys it on eBook, but only when she plans to read it next, so that she does not ‘spend money’ on multiple books she won’t be able to read.
Ditch that debit! Opt for a credit card instead of a debit card
The money expert noted that she stopped using her debit card to make every purchase
The money expert then noted that she also stopped using her debit card to make every purchase to become more financially literate.
She explained that by using a credit card more frequently than a debit card, you can receive more benefits, however Caitlin noted that you should only use this tip if you are ‘disciplined.’
‘Using a credit card can give you extra money in the form of points [and] cash back.
‘As long as you’re someone who is disciplined enough, this is key, disciplined enough to pay off your balance fully every single month, then you can get a little something extra by using a credit card with the right rewards system that maximizes your spending,’ she explained, before adding that there are many ‘sites on the internet that can help you find the right credit card for you.’
In addition to receiving more rewards, money experts recommend using a credit card more frequently than a debit card because it offers stronger fraud protections.
The most important part of using a credit card is to treat it like it’s a debit card, which means not spending more money than you have and not just paying your minimum balance every month.
Don’t let the money sit! Stop letting deposits build up in your account
Caitlin explained that she never allows deposits to ‘build up’ in her account
The money coach noted that her last tip was by far the most crucial and ‘biggest tip’ on her list.
Caitlin explained that she never allows deposits to ‘build up’ in her account.
‘Immediately when income comes into my account, I separate it into different account for savings [and] investing bills.
‘This really helps me stay on top of my financial goals and creates so much transparency about where my money is meant to be going,’ she added.
Although inflation has decreased in the past few months, it still remains high and sits at 7.1 per cent.
As the cost of living soars, people across the country are forced to skip out on meals to save money.
According to consumer data firm Dunnhumby, one third of households are skipping meals or reducing their portion sizes to save money.
Researchers found that 18 per cent of survey’s 2,000 participants noted they weren’t getting enough food to eat.
Furthermore, 31 per cent of households have reduced their portion sizes due to empty pantries as a result of rising grocery store prices.
In addition to food costs, million of people across the country lack a financial safety net.
According to researchers, 64 per cent of participants admitted they wouldn’t be able to raise $400 in an emergency.
Many have suffered due to inflation, which has caused the prices of basic goods to skyrocket – including the prices of meat and poultry up by 10.4 per cent, cereal up 15.1 per cent, and fruits and vegetables up 8.1 per cent.
Gas prices are another point of pressure for many people around the country, up nearly 60 per cent over the past year, with the cost of airfares up more than 34 per cent and price of used cars up more than 7 per cent.
Apparel costs are up by 5.2 per cent, overall shelter costs went up 5.5 per cent and delivery services have gone up 14.4 per cent.
In the past, 37-year-old Rachel Covert, from Massachusetts, shared her money-saving tips that helped her retire at age 36.
She revealed she followed the 4-per-cent rule – that sees her never spending more than four per cent of her assets in a given year – in a bid to live her life to the fullest and invested in low-cost index funds.
Dyana King, a 30-year-old from Arkansas, shared that six years ago she saw herself strained with $34,907 in debt and used the snowball method to pay it all off.
The snowball method is the practice of listing out every debt you owe and paying off the smallest debt first before working to pay off the next smallest.
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