When it comes to managing money and improving personal finances, there are some best practices to help make the most of your resources, whatever they are.

Review Current Finances

Look carefully at your minimum expenses. A good budget includes all of your regular expenses, including expected bills likes rent,  phone, utilities, transportation, and groceries.  Make sure to include any irregular expenses, such as car insurance or annual memberships.

This is a good time to really look at where your money goes outside of life essentials. Use your budget to track what you’re actually spending, not what you’d like to be spending.  For example, you might have a monthly bus card under your minimum expenses, but realistically, also have expenses from Uber for a morning you’re running late or a night your have to work late.

Reduce Expenses

Another way to improve your financial situation is to reduce expenses.   This is where everyone talks about Starbucks, but let’s be real, skipping a $5 latte isn’t going to save you nearly as much as changing to a cheaper phone plan and paying out less every month.  In general, don’t just look at reducing discretionary spending, also consider negotiating bills,  eliminating unnecessary subscriptions, and looking for ways to reduce transportation costs. Riskology describes a strategy to save 25% on monthly bills.

Prioritize Savings

Skipping a latte or canceling NetFlix isn’t really going to help if you’re hit with a car repair or medical bill for hundreds or even thousands of dollars. This is where emergency savings come in. This means that you making saving a priority in your budget, just like every other bill, and devote a portion of your income to savings each month. This will help you build an emergency fund, which can provide a cushion in case of unexpected expenses. There are also online short-term financial solutions for emergency expenses.

Borrow Wisely

Borrowing money can be a part of a sound financial strategy, when it’s done right. For example, responsible use of credit cards overtime can help build up a good credit score, which is essential for buying a home. Also, borrowing money to purchase a home can be a wise investment, since you’ll be paying a (usually!) lower mortgage and property has the potential for long-term appreciation.  Personal finance blog I Pick Up Pennies explains how even how a tiny mortgage overpayment can reduce monthly expenses for years to come.  However, it’s important to avoid taking on too much debt.

Save For Retirement

It can be difficult to save for the long-term future, but many financial experts say the key to saving for retirement is starting early and making it a habit. There’s not a lot we can do today about starting early, but if you can save even a small amount regularly, you can put it in an IRA for the tax benefits. There are two main types of IRAs: traditional and Roth. A traditional IRA offers tax-deductible contributions, while a Roth IRA offers tax-free withdrawals in retirement. Which one you choose will depend on your personal situation, of course, but everyone needs retirement savings.

If your employer offers a 401(k) or similar retirement plan, take advantage! Sign up and contribute as much as you can afford. Some employers offer matching contributions, which  increases your retirement savings even more.

Increase Your Income

Yeah, yeah, easier said than done. But increasing your income — even by just a little bit — will help to improve your financial situation. Consider freelance work, an extra shift at work, taking on part-time hours for something like Uber or DoorDash, having a garage sale, or other ways to generate extra income.

Be Patient

Improving finances can take some time, especially for those starting with no savings, low income or both. However, by making small changes and being really intentional about savings, you can steadily improve your financial position.