7 Tips That Helped Me Get My Finances on Track

27 Apr 2025 #misc

The fear of letting my salary slip through my fingers pushed me to organize my finances.

I had doubled my salary as a Software Engineer. I was earning in a stronger currency. And I didn’t want to regret letting all that money leave my pockets without doing anything productive with it.

I read finance books and watched YouTube influencers to get my finances in order.

Out of all that content, here are 7 tips I followed to take care of my finances:

1. List your sources of income and expenses. This is to know how your money is flowing in and out of your pockets.

2. Follow the 50/30/20 rule for conscious spending instead of strict budgeting. I learned this one from “I Will Teach You To Be Rich” by Ramit Sethi. Set apart 50% of your income for fixed expenses like housing and food, 30% for savings and investing, and 20% for guilt-free spending. Of course, tweak those last 30% and 20% to suit your needs.

3. Use the envelope method. Separate your income into categories by putting your money into envelopes. And only spend what you have in each envelope for each category. For example, only use the money from the “Coffee” envelope to drink coffee outside. Of course, you can follow this method with virtual envelopes in your bank account.

4. Pay yourself first. This is a lesson from “The Richest Man in Babylon.” Before paying for your expenses, save and invest first.

5. Start an emergency fund. Call it F*ck-you money or whatever you want. But save enough to cover months of expenses in case you lose your job or face any other emergency. A strong emergency fund was crucial when layoffs came knocking.

6. Be careful with your credit card. Use it if wisely. Only if you already have money to pay for purchases and take advantage of extra benefits like travel insurance or access to lounge rooms in airports.

7. Automate your payments and investments. Again, another lesson from “I Will Teach You To Be Rich.” The goal is to live a rich life, outside of spreadsheets. So automate payments for your credit card and automate deposits into your savings or brokerage accounts.