Four Tips to Improve Your Financial Future

By Katie Ross

Many Americans are struggling with managing debt and saving money.

Nearly 90% say they regularly look at their bank accounts to see where they can cut back on spending. However, in April of 2025, fewer than 30% said they had used an actual budget in the past month.

Unfortunately, being stressed about money can lead to conflicting habits like this: worrying about your finances, without ever creating or following a real plan. 

If you find yourself in this situation, know that you don’t have to stay stuck in a doom loop, just wishing you could do better but not knowing where to start. Instead, you can follow these practical tips to turn your finances around for good. 

1. Budget to spend less than you earn

Without a budget, there’s no way for you to know how your monthly income compares to your expenses. But you can create a budget pretty easily, just by listing out all of your monthly expenses and comparing them to your net income (your take-home pay).

Ideally, your income should always exceed your spending. That way, there will be some money left over to pay off debt, automatically contribute to your emergency savings or save for retirement. 

If you’re spending more than you’re earning, you’ll need to reduce your spending, increase your income, or both. If you’re not sure where to start, reach out to an NFCC-certified credit counselor for help.

2. Understand your credit reports

Credit reports and scores are often misunderstood, and many people are unclear on how their credit impacts their finances.

If you have below-average credit (meaning your FICO scores are roughly 669 or lower) you may end up having the following problems: 

• Your applications for loans, credit cards and apartments are denied.
• If approved for new credit cards or loans, the interest rates are sky high.
• You have trouble getting jobs that require credit checks.
• You could pay high premiums on your car insurance. 

Instead of staying in the dark about your credit, take some time to review your credit reports and understand what’s in them. You can pull all three reports (Equifax, Experian and TransUnion) for free, once a week, from AnnualCreditReport.com or by calling 877-322-8228.

Your credit scores don’t come with these free reports, but you can usually see a version of your credit score for free through your credit card account or bank account. 

If you need help improving your credit, an NFCC-certified credit counselor can review your credit reports and give you personalized tips on how to boost your scores.

3. Don’t get bogged down with debt

You can’t always control your expenses, but you can control how you pay for them. 

One smart strategy for covering purchases is to always carry cash or your debit card, instead of carrying your credit card. When you do this, you limit your spending to the money you’ve already earned, instead of borrowing against your future income. 

If you do use a credit card, aim to never charge more than you can pay off within a month. If you fail to pay off your full credit card balance by the monthly due date, you can be hit with HUGE interest charges.

How high are credit card interest rates? For comparison, the average rate on 24-month personal loans is currently 11.57%, while the average rate on credit cards is nearly twice as high, at 21.16%. 

If you owe $2,000 on a credit card and pay it back over the course of 24 months, you’ll be charged $470 in interest. 

4. Prepare for retirement early

In retirement, your income will likely drop, while many of your expenses rise due to inflation and increased medical needs. So even if retirement seems far off, it’s essential to start preparing now. In fact, the sooner the better. 

For example, let’s say you want to contribute $200 a month to your retirement account, you plan to retire at age 67, and your retirement savings will earn a 7% average rate of return. If you start contributing at age 30, you’ll have roughly $419,000 by retirement. However, if you wait until age 45, you’ll only have $125,000 by retirement.

For many people, the easiest way to start saving for retirement is through an employer-sponsored retirement plan, such as a 401(k). Some employers will even match part of your contribution, which means you get free money. 

If you don’t have a retirement account available through your employer, consider opening an IRA and/or a self-employed 401(k) to start building up your retirement fund.