The Savvy Gal's Guide To Managing Money

If you're like us, your credit cards are probably still smoking from a season full of spending. Or, maybe you're used to living beyond your means. Either way, if one of your burning goals is to get into better financial shape, you're in luck. We have just the expert advice you need to get you there faster than money pouring out of an ATM machine.
Whether you want to know what to invest in or simply need to get better about starting a rainy-day fund, advisor Janice Goldman Picker of Ameriprise Financial has all the know-how to help you out. And, the best part? It doesn't have to be January to jump on the fiscally responsible bandwagon. Trust, as soon as you get a handle on planning your budget, you'll be on your way to a greener future in no time. Move over, Daddy Warbucks. We've got this.
Advertisement
1 of 6
Illustrated by Caitlin Owens.
Budgeting
Truth: Setting a budget (and sticking to it) is easier said than done — especially if you're a gal who likes to shop, travel, or go out (who doesn't?). So, to help make saving a reality, it's all about accountability and prioritizing.

1. Track Your Spending: It sounds simple, but how many of you are actually writing everything down? Whether you use an online tool or a simple spiral notebook, document, document! Yes, it will probably be a sobering experience (i.e. the reality check from spending dough on that daily cappuccino.), but it will be well worth it when you're in the green — not the red.

2. Core Values: Picker suggests thinking of what's really important to you so that your spending can become prioritized and clear — in other words, value-based financial planning. "If family is your number one value, do you really need to spend as much on dining out? Designer clothes? Daily coffee runs? All of this can add up quickly. You want your budgeting and spending decisions to be in alignment with your values," says Picker.
2 of 6
Illustrated by Caitlin Owens.
Paying Down Debt
Even though you may poke fun at those cheesy late-night commercials about drowning in debt, it's not laugh-worthy when you're the one treading water. It's time to grab a hold of that proverbial life ring, dear reader.

1. Get Interested In Your Interest: Picker suggests you start by getting a clear understanding on the interest you’re paying on your debt. Carrying a hefty balance? It's time to bust out your best negotiating skills and ask your credit card company for a rate reduction. "If they will not honor your request, get a zero percent balance transfer to another card you already have, but make sure your rate won't increase when it resets," says Picker.

2. Create A System: After you've negotiated and transferred balances, it's time to get a grand plan in motion so that you're systematically paying down your debt. "Start by paying down your highest interest rate debt first," advises Picker. Of course, don't forget to track your monthly spending and stay on track with your budget so you're not racking up more debt. Half-yearly sale at Nordstrom? Just. Say. No.
3 of 6
Illustrated by Caitlin Owens.
The Importance Of Protecting Yourself
You're healthy as a horse, right? Those crazy accidents you see on the news? That could never happen to you. We don't mean to play the role of Debbie Downer, but life can take a turn for the worse when you least expect it, so make sure you're suiting up in some life-insurance armor.

1. Disability Insurance: Because you never know when you might be out of work for a long period of time — and not because of a vacation.

2. Life Insurance: While the amount of life insurance one needs is different for everyone, if you are taking care of any dependents, you're definitely going to want to protect them with a solid LI plan.

3. Long-Term Care Insurance: This type of insurance provides reimbursement up to a stated daily maximum and for a set period of time. "In general, people are living longer, but on average, women live longer than men. says Picker. "This results in the need for additional retirement funds and increased health and long-term care costs." So, while you may not want to think about it now, this even includes not being able dress, bathe, eat, or even walk by yourself.

4. Umbrella Insurance: Personal accidents alone don't create drama. Should someone take a spill — or worse — on your property, you could lose your entire savings (yikes!). But, don't sweat it. According to Picker, this type of protection is generally inexpensive.
4 of 6
Illustrated by Caitlin Owens.
Have An Emergency Fund
Okay, rainy-day fund may sound more fun than emergency, but the truth is, whether life throws you lemons (job loss) or lemonade (a wedding), you're going to need an extra influx of cash. So, Picker recommends you estimate how much your monthly expenses are and having at least six-to-nine months in the hopper.

1. Track: Just like with creating a budget, figure out where your money is going by starting a money journal to track exactly what you’re spending.

2.Budget: Include the amount you want to save each month in your overall budget.

3. Auto-Deduct: Make it easier to save by systematically saving from each paycheck. "If money is being directly deposited into a savings account, it’s easier to build up that buffer," says Picker.
5 of 6
Illustrated by Caitlin Owens.
Long-Term Financial Goals
Guess what? It's actually a really good idea to be a dreamer! Seriously, how else are you going to get that flat in Paris?

1. Establish Goals: Just like you can't run before you can walk, start by defining your long-term goals. Ask yourself questions about your future, such as where you see yourself living, what lifestyle factors are important to you, career goals, etc.

2. Assess: "After you identify your goals, assess your current financial status," says Picker. This includes gathering documents and account numbers to see what’s really going on with your finances (nobody has to know!).

3. Create A Plan: "Establish a course of action to help you get from where you are to where you want to go," suggests Picker. So, your savvy strategy may cover all or some of the following: your needs, goals, and values; current assets and liabilities; retirement plan, insurance audit and needs analysis; and estate planning analysis.
6 of 6
Illustrated by Caitlin Owens.
Investing Opportunities
While there is no "magic bullet" for investing success, Picker recommends you adopt the asset allocation strategy to help improve your investing results. "While asset allocation does not assure a profit or protect you against a loss, a diversified portfolio can help you weather the market’s ups and downs and potentially reduce the level of volatility in your investment portfolio (i.e. stocks, bonds, real estate, and cash)," says Picker.
Advertisement