While investing in the ASX may seem easy, particularly if you're picking winners like Afterpay Touch Group Ltd (ASX: APT), taking care of your personal finances can be challenging at times.
Between working, looking after the family and maintaining a social life, our personal financial habits can often slide due to complacency or inability to dedicate the time.
That's why I've looked at three simple habits to get into that can improve your financial situation straight away.
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Create a budget
Whether it's a large company like BHP Group Ltd (ASX: BHP) or your own household, you can't get a grip on your finances if you don't know where your money is going.
The best way to improve your financial situation is sit down and make a budget based on what you're actually spending, to see where your money is going month-to-month and where you can cut down expenses.
There are a number of budgeting apps out there that make this process super simple, or you can do it the old fashioned way in an Excel spreadsheet or a pen and paper.
Whatever your method, it's best to keep track of your spending on some level to take the next step and optimise your personal finances.
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Automate your banking
One of the hardest things to avoid as an employee who is paid monthly is what I like to call the "payday splurge".
When you see your monthly pay hit your bank balance, it can be tempting to spend that extra cash that you've worked so hard for to treat yourself – but that's a bad idea.
While you should treat yourself every now and then, doing so in a more systematic and controlled manner will lead to better spending habits and an overall increase in wealth.
One easy way to do this is to set up a high-interest savings account that you don't have a spending card linked to, and redirect your pay into this account.
From here, you can then pay yourself a set wage each week and have better budget control while also accumulating more interest and principal in that high-interest account each month.
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Invest more in the ASX
Once you've done the admin side of things, you're ready to go and have the fun of investing your hard-earned cash into real companies on the ASX.
Whether you like the growth prospects of Altium Ltd (ASX: ALU) or the blue-chip status of Woolworths Ltd (ASX: WOW), that additional money building up in your savings account and accounted for in your budget can start working harder for you immediately.
With some solid stock picks and a touch of luck, you'll be well on your way to building your wealth and letting your ASX portfolio do the money making for you.
