Everybody knows that when you are trying to build something, you need the right tools. The same goes for building wealth – you need to have the right financial tools. Financial planners say the key to good money management and reaching your financial goals is to concentrate on your savings, spending, and increasing your net worth. According to Certified Financial Planner, and writer for the Business Insider, Tanza Loudenback, here are three of the best financial tools to help you do that.
1. Savings Buckets
I remember when my mom used to have separate envelopes dedicated to specific bills and such, and when my dad would bring home his pay, she would dole it out into each of the envelopes. Loudenback says that Ally bank’s “Savings Buckets,” are a modern version of that same idea, that lets you save for specific financial goals. With Savings Buckets you can open sub-accounts and nickname them for particular purposes. She says that with buckets, you can separate savings into categories like emergencies, vacations, and more. All of the funds and accounts are accessible from the same, easy-to-use dashboard. Also, you can allocate what percentages you want to go to which buckets, on every deposit you make.
Google spreadsheets is an easy to use and access tool to create various spreadsheets to manage your money. In fact, Loudenback has created two spreadsheets that she uses regularly to better manage her money. One is for her overall cash flow and one is for her rewards credit card.
3. Net Worth Tracker
Your net worth – the difference between what you owe and the value of your assets – is a sure sign of your financial health. Loudenback says she tracks hers by using a net worth tracking tool from Personal Capital. Personal Capital is an online financial advisor that offers wealth management, banking, budgeting, and financial planning services. It’s free to open an account and use most of the tools, including the advanced savings planner and retirement planner.