I Compiled the Top Tips from the Personal Finance Reddit Community

Written by Zoe King ✏️

Last updated May 22, 2024

The personal finance Reddit community (r/personalfinance) is a goldmine of information.

I combed through the threads to find the absolute best tips.

Why? To help you get your finances on track.

In a survey conducted in April of this year, approximately 47% of participants aged 18 to 29 years reported that they felt their finances had remained about the same as the previous year.

However, 39% of respondents aged 30 to 44 said they were financially worse off than they had been the previous year, while only 12% said they were better off financially the year before.

These tips from the personal finance Reddit community are compiled to help you be among the 12%.

I Compiled the Top Tips from the Personal Finance Reddit Community: Here Are 30 Insights You Must See

Top Tips from the Personal Finance Reddit Community

 

I’ve distilled the wisdom from the personal finance Reddit community into 30 bite-sized actionable tips, organized into key categories covering all aspects of personal finance:

  • Earning and Investing
  • Saving
  • Spending and Budgeting
  • Debt
  • Mindset

 

Earning and Investing

This category explores tips for making money and increasing your income.

 

1. Turn up the volume on your income

The first step to winning in personal finance is to focus on making more money rather than focusing on cutting costs, although this is also important.

For most people who struggle financially, the root of the problem might be that they’re not making enough money.

Cutting back on expenses won’t address this underlying issue.

So, explore additional income streams, whether a side hustle, a part-time job, an online business, or monetizing your hobbies.

Increasing your income provides you with more options and opportunities.

 

2. Consider a job or career change

If your current job is limiting your financial capacity, try renegotiating your salary.

If that doesn’t work, consider switching to a company that offers higher pay.

If your industry’s pay is generally low, what’s stopping you from pursuing a completely new career path?

Making a career change could result in a substantial increase in income.

 

3. Put yourself on a salary as a business owner

No matter how small your business is, avoid the temptation of dipping into all the business profits for personal needs.

It’s best to separate your venture’s finances from your personal finances and pay yourself a regular salary.

This will help you budget effectively, keep your business finances organized, and reinvest some profits to grow your business.

 

4. Automate your investments

Schedule automatic transfers from your checking or current account to your investment account (have a separate account for investment funds).

This approach forces you to “pay yourself first” and ensures your future gets funded before your spending habits kick in.

Invest these automated deposits in a variety of assets – think stocks, real estate, crypto, or other options.

Remember, diversification is key to a healthy portfolio.

 

5. Don’t lose your money

Growing your wealth is important, but protecting it is crucial.

Be wary of get-rich-quick schemes, unrealistic returns, or unsolicited investment advice. Remember, “if it sounds too good to be true, it probably is.”

Be careful not to entrust your money or assets to just anyone for investment, especially online, unless you fully trust the situation.

 

Savings

According to Bankrate’s Emergency Savings Report, 36% of U.S. adults have more credit card debt than emergency savings.

This section will provide you with practical tips for successful saving.

 

6. Inflationary vs deflationary savings

Saving is great, but don’t let inflation erode your purchasing power.

Consider shifting your savings from traditional inflation-bound accounts to deflationary assets.

In other words, save in assets that can retain value and potentially appreciate. Unlike fiat currency, these assets tend to increase in value over time due to a limited or decreasing supply.

Examples include certain cryptocurrencies such as Bitcoin, real estate, or even collectibles with a proven track record of value appreciation.

Bitcoin, for instance, has a fixed supply that is not subject to the whims of central banks or governments. Thus, it emerges as a deflationary hedge, mirroring the behavior of traditional safe-haven assets like gold.

 

7. Lower your taxes

Don’t let taxes drain your hard-earned income.

Explore programs that reduce your taxable income by letting you set aside pre-tax dollars for specific expenses, like dependent care accounts.

Take advantage of employer-sponsored retirement plans like 401(k)s to benefit from employer matching contributions and tax advantages.

Research options like IRAs for retirement savings or HSAs for healthcare needs, both offering tax benefits depending on your situation.

 

8. Move to a tax-friendly or tax-free country

Consider relocating to a country with favorable tax laws or to a tax-free jurisdiction in order to minimize your tax burden and potentially increase your savings.

 

9. Treat savings like a bill

Your savings deserve priority, just like any other bill. This tip suggests treating savings like fixed expenses.

Set up automatic transfers to your savings account to ensure that a portion of your income goes directly to savings before you have a chance to spend it.

Additionally, consider exploring the “Spend & Save” options certain banks provide.

These programs automatically save a predetermined percentage of all the money leaving your account or debit card, and you can customize the percentage to suit your needs (1%, 3%, 5%, etc., of all expenses).

While the amounts might seem small, they can add up significantly over time.

 

Spending and Budgeting

Here, you’ll find strategies to manage your expenses and budget effectively.

 

10. Track every spending

Knowledge is power, especially when it comes to your finances. You can’t manage what you don’t measure.

By understanding exactly where your money goes, you can create a realistic savings plan and identify areas to cut back.

 

11. Beware of lifestyle creep

Congratulations, your income is on the rise. But this is not the time to party or move to a bigger house than you need.

Don’t let your lifestyle inflate. This sneaky phenomenon tempts you to increase your spending as your income grows.

Instead, use this windfall to solidify your financial future by increasing savings, investing more, and paying off debts.

 

12. Embrace minimalistic spending

Minimalism isn’t just about physical clutter; it can be applied to your finances as well.

For example, you might want to declutter your belongings by selling unwanted items to generate extra income and reduce storage costs.

You might also want to audit your monthly statements and cancel unused subscriptions. Those forgotten gym memberships or streaming services can be a silent drain on your finances.

 

13. Earn while spending with crypto cards

Cryptocurrency is becoming more integrated into our everyday financial transactions. Using a crypto debit or credit card provides a simple way to use digital currency for daily expenses.

These cards do not convert your cryptocurrency into fiat currency in advance; instead, they convert at the point of sale, allowing you to pay for goods and services with your digital assets.

The icing on the cake is that you can earn cryptocurrency rewards for every transaction, providing a passive way to grow your digital asset portfolio.

 

14. Challenge yourself to a spending freeze

Try challenging yourself with a spending detox. Identify a specific category, such as unnecessary spending on other people, and restrict spending in that area for a set period.

You can also challenge yourself with a no-spend weekend, breaking the routine and saving the money you would normally spend on weekend activities.

Another idea is to challenge yourself with a no-buy month, testing your willpower and focusing on using what you already have for a designated period.

 

15. Do things by yourself

This personal finance Reddit community tip implores you to take control and become more self-sufficient.

Instead of spending all the time, try to do more things by yourself.

For example, fix things on your own. Embrace DIY projects – learn basic repairs or maintenance skills to save money on professional services.

Cook more meals at home. Eating out frequently can eat away at your budget.

 

16. Consider alternatives

Before making a purchase, consider alternatives such as renting, repairing, or buying used items instead of new ones.

Also, look into cheaper options like generic brands or discount stores for your everyday needs.

Always compare prices from different sources to ensure you’re getting the best deal.

 

17. Practice delayed gratification

Resist the urge to make impulse purchases and prioritize saving for your goals.

Create a realistic budget that allows for some flexibility to prevent feelings of deprivation and discouragement.

Don’t spend everything you earn. There will always be needs. Don’t feel pressured to keep up with the Joneses.

 

18. Renegotiate your contracts

Review recurring expenses like cable, internet, or gym memberships and see if you can negotiate a better rate.

 

19. Utilize cash for purchases

Paying with cash can make you more mindful of your spending than swiping a card.

 

20. Create spending friction

This personal finance Reddit community tip advocates unlinking your cards from shopping sites.

Friction is your friend. Make those extra purchases a conscious decision.

 

Debt

A recent survey revealed that 49% of credit cardholders carry a credit balance from month to month, a potentially costly practice given the average credit card interest rate exceeds 20%.

These tips from personal finance Reddit will equip you with strategies to tackle debt wisely and avoid common pitfalls.

 

21. Negotiate lower rates

You can reach out to your creditors to discuss the possibility of lowering the interest rates on any current debts you may have.

This could potentially help you save money and make it easier to manage your repayments.

 

22. Avoid taking on new debt

It’s important to only borrow for essential needs and focus on paying off existing debt before taking on new loans.

Also, it’s best to avoid using credit cards to pay off other debts, as this can lead to a cycle of high-interest debt.

 

23. Consolidate your debts

Simplify your repayments by combining multiple debts into one with a lower interest rate.

For example, a balance transfer credit card allows you to transfer high-interest debt to a card with a lower introductory rate to save on interest charges.

It typically offers a 0% introductory APR period, allowing you to save on interest payments for a limited time.

 

24. Avoid co-signing on loans

It is highly recommended that you avoid being a co-signer for loans as much as possible.

Co-signing on a loan can be a risky proposition. While you might be trying to help someone you care about, it can have serious consequences for your own financial well-being.

If you must do it, understand the risks and potential financial burden and be ready to bear them.

 

25. Consider a debt snowball or avalanche approach

Decide if paying off the smallest debts first (snowball) or tackling the highest-interest debts first (avalanche) is the best strategy for you.

 

Mindset

Your beliefs about money can significantly impact your financial behavior.

This final section of tips from the personal finance Reddit community focuses on developing a healthy and positive approach toward money.

 

26. Shift your perspective on money

Change your limiting beliefs about money. View money as a tool to achieve your goals, not a source of stress.

Identify negative thoughts about money and replace them with empowering affirmations.

Focus on financial well-being and start feeling in control of your finances, prepared for the future, and able to live a fulfilling life.

 

27. Learn from your financial mistakes

It’s essential to approach your financial mistakes with a reflective mindset.

Instead of being overly critical of yourself, take the time to thoroughly analyze the factors that led to the misstep.

By dissecting these aspects, you can derive valuable insights to enhance your decision-making in the future, leading to a more robust financial trajectory.

 

28. Educate yourself about personal finance

Start with basic concepts like budgeting, saving, and investing.

Learn about managing debt, building credit, and planning for retirement. Stay informed about economic trends and financial news.

Read personal finance books, blogs, and so on.

Continuous learning empowers you to make informed financial decisions and achieve your goals.

 

29. Focus on what you can control

Focusing on what you can control is key to maintaining financial peace of mind.

While external factors like the economy or financial markets may fluctuate, concentrate on increasing your income, managing your finances with prudence, and spending wisely based on your goals.

In other words, build your own little world around your finances.

This will allow you to navigate uncertainties more effectively and stay on track toward your financial objectives without undue stress over factors beyond your control.

 

30. Practice gratitude for what you have

Practicing gratitude for what you have can greatly enhance your overall well-being, including your financial health.

By acknowledging and appreciating the resources and opportunities you possess, you cultivate a positive mindset that fosters contentment and reduces the feeling of dissatisfaction or comparison with others.

This generally leads to satisfaction with your financial circumstances.

 

Wrapping Up Top Tips from the Personal Finance Reddit Community

The wealth of knowledge shared by the personal finance Reddit community can be quite enlightening.

From budgeting and saving strategies to investment insights and mindset shifts, the collective wisdom offered by users can transform your finances.

By implementing these top tips, you can more easily navigate the complexities of personal finance with confidence.

If you have any questions, feel free to send them here.

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About the Author

Zoé King is a successful digital entrepreneur and creator who founded SHiFTCADEMY.COM as a way to help awesome people like you find legitimate and future-proof income ideas so you can make money and shift your life forward!

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