Good financial habits to turn your finances around

profile Erin Bruehl  |  October 6, 2021

It's easy to be good with money when you have plenty of it available. It's even easier to be a financial whiz when you have an army of accountants helping to make your money go further.

But anyone, at any income level, can develop good financial habits.

If your bank account feels awfully small these days, the changes you make now could add up to a big difference over time. You don't need to overhaul your entire life. You just need to start somewhere.

Consider these eight tips to turn your finances around.

1. Budget Like a Pro

More than 67% of Americans keep a household budget. Those who do know exactly how much money they have coming in and going out each month. If you don't keep a budget, it's time to start.

Incredibly complex budgets that track expenses down to the last dollar are right for detail-oriented families. But for people on the go with little time to spend analyzing their finances, simplicity is key.

To create a budget, you must know three important figures.

  1. Income: How much do you take home after taxes?
  2. Expenses: How much do you typically spend each month?
  3. Daylight: Where can you cut money from expenses to allow you to pay down debt and save more money?

You don't have to get all the details right the very first time. In fact, your first budget will probably be filled with holes and gaps and wishful thinking. But stick with it. The longer you keep detailed records, the more accurate your budget will be.

Use tools, like those in our banking app, to make budgeting easier. We'll tell you when and where you spend money so you can spot trends quickly. With Current, you can create budgets and get an easy glance at your monthly spending with our ‘Money In, Money Out’ feature.

2. Factor Fun Into Your Budget

It's tempting to set unrealistic goals when you create your first budget. You'll never buy a new shirt again, right? If your plans are too strict, you're bound to slip. And you deserve a little fun for all the hard work you do every day.

Ensure that you've set aside a bit of money in your budget for:

  • Social activities. Don't let your coffee date with a friend or your coworker's going away party slip out of your budget.
  • Holidays. The average family spends $800 on Christmas alone. That total may be too high for your budget, but putting a few dollars aside for gifts now could keep you from impulse purchases later.
  • Rewards. Saving money is tough work. A special treat, like a lunch out, could keep you motivated and focused.

Be as reasonable and as kind to yourself as you can, and you're more likely to stick with the budget you built.

3. Save at Least Something Every Month.

Experts encourage everyone to place 20% of take-home pay in savings. That figure may seem too high to you. Don't be intimidated.

Use your budget to set a reasonable savings goal, and know that it's made for you and no one else. Perhaps you can only save $10 per month. That's perfectly acceptable if you can stick with it.

The longer you keep saving, the more it will become a habit for you. And as your income increases, you'll be able to save even more.

Automation may help. Our Savings Pods, for example, allow you to round up dollar amounts on each purchase you make, so you're saving while doing things like buying gas and groceries. Every dime helps you build up your account.

4. Same Money on the Little Things

Look over your spending carefully, and you may spot an area or two that's ripe for budget cuts. Dramatic changes aren't required. Saving $10 here or $20 there can add up in time.

For example, Americans spend more than $4,000 per year on groceries. You could cut your bill by:

  • Limiting access. Shop only once per week rather than heading in (and filling up with impulse purchases) every day.
  • Using a list. Write down what you need, and buy only those things.
  • Tapping on a calculator. Keep a running tab of your bill, and you may find that some items you wanted (like imported beer) are out of your price range.

You may also find ways to save on eating out or caring for pets or creating a wardrobe. Just watch for opportunities to save, and know that every cut matters.

5. Pay Your Bills on Time

About 5% of consumers never get money to their creditors when it's due. Chances are, those people pay extra each month in penalty fees. And their credit scores take a hit with each deadline they miss.

Cutting back on unnecessary fees and penalties is a smart way to stick to your budget. If you're always late in paying your bills, set alerts on your phone so you always keep your commitments.

And if you can't pay your bills because they don't arrive in time with your paychecks, call your creditors. Moving your due dates by a few days could mean all the difference in saving money.

With Current, you can get your up to two days paycheck faster, and this can help you avoid late bill payments. We also offer free overdraft up to $100 and never charge overdraft fees so you don’t have to worry about added costs.

6. Track Your Bank Balance Carefully

Create a budget, and you should know how much money you have each month. But how much do you have right now? And are you on track this month? Answer those questions by staying in close contact with your bank and checking your budgets in the Current app.

Use online banking tools like ours to understand your balance. Make sure you know when money is both coming out and going back in.

And remember that some banks do charge up to $35 for overdrafts. If you're running low on funds and don't know it, you could lose a lot of money very quickly, and that could blow your budget. But you’ll never have to worry about that with Current.

7. Stop and Think Before a Major Purchase

We're all tempted to jump when we see a low price or a good deal. But do you really need the item that's tugging on your heartstrings?

Create some space before you make a purchase. Try:

  • Layaway. Pay a bit now, and agree to pay the rest later before you take the item home. If you change your mind, you'll get your money back.
  • Alerts. Set a 24-hour timer on your phone, and don't let yourself buy until it goes off. You may find you're less interested as time passes.
  • Buddies. Ask a friend to keep you in line and talk with you if you're tempted to buy. Talking through your impulse desire could make it fade.

You'll build up financial discipline in time. But these quick tips can help in a pinch.

8. Use Your Credit Card Carefully (if at All)

The average American has more than $6,000 in debt. If your budget is tight, paying back that money can be tough. Adding to the balance makes your work even harder.

If you're tempted to abuse your card, keep it at home in a locked drawer rather than in your purse or wallet. If you have to think before you use it, the temptation may diminish.

If you don't have a credit card at all (and plenty of people don't), avoid opening an account. Use your Current card instead.

Choose the Right Financial Partner

We’re proud our commitment to getting our members faster and better access to their money, strong incentives, and exceptional technology. This combination makes us a great choice. Work with us as you set budgets, create good savings habits and spend your money on the things that matter to you, and never on overdraft or hidden fees.

We help many people like you. Download our app and let's get started! You can sign up for Current in two minutes.


Fewer Americans Are Budgeting in 2019 — Although They Think Everyone Else Should. (April 2019). PR Newswire.

What's Reasonable for Christmas? Ramsey.

What Is the 50/20/30 Budget Rule? (August 2020). Investopedia.

Consumer Expenditures 2019. (September 2020). U.S. Bureau of Labor Statistics.

Six Out of 10 Americans are Anxious About Bills and Nearly Half are Late on Paying Them, Study Shows. (November 2018). Business Wire.

Lawmakers Put Banks on Notice: Stop Charging Overdraft Fees During the Coronavirus Pandemic. (April 2020). CNBC.

Alaskans Carry the Highest Credit Card Balance: Here's the Average Credit Card Balance in Every State. (August 2020). CNBC.

7 Things to Do for Your Finances Before 35. (November 2018). Intuit Turbo.

Financially Screwed? 3 Ways to Turn Your Money Life Around. (April 2016). AOL.

Current is a financial technology company, not a bank. Banking services provided by Choice Financial Group, Member FDIC.

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