With so many financial products on the market available to consumers, it’s more important than ever to make sure you’re financially literate and in control of your finances. Effie Zahos, Editor of Money Magazine and financial extraordinaire, shares six ways you can get back in control:

Manage your money week to week

You should be actively deciding where you want your money to go. Whether you receive weekly, fortnightly or monthly pay; divvy up your pay into four separate accounts.

Create an account for your weekly bills, another for mandatory costs like car registration and servicing, a miscellaneous account (because you never know when things just ‘pop’ up), and your long term savings account. Once you’ve worked out your weekly bills and ideal savings, organise for that money to be automatically transferred into their designated accounts. Whatever money left, is your ‘play money’ to last you until your next pay cycle.

Think about what is important to you! Don’t ever look back and wonder where your money went.

Plan for the future

Have a goal for the future and a plan to reach it. You’ll be surprised what you can achieve when you put your mind to it. But without a plan, it won’t happen.

Start by writing down all the goals want to achieve and the financial input involved reaching it. Develop a realistic timeline and see how your plans abide with your weekly money management. Ensure your financial goals are realistic and account for mishaps like car breakdowns and celebrations.

Make your finances as easy as possible

We all have good intentions, but don’t necessarily get around to it. Make things automatic instead. Have money go automatically into your savings account or investment account every payday. This way, you don’t get overwhelmed seeing your entire paycheck in your bank account and you don’t (un)intentionally hoard the funds.

Set up a direct debit to pay your regular bills for mental and financial clarity.

Talk to your partner

Nothing kills a relationship like financial tension. Talk to your partner about where you stand financially and where you want to go. Whether you’re in a short or long term relationship, opening a joint bank account is a big decision to make. Ensure you’re both willing to commit to an agreed upon contribution on a frequent basis. Be sure to outline the instances when your joint account can be dipped into and that you’re both working towards a common goal.

If your partner wants a house and you want a 12-month round-the-world holiday, learn the value of compromise. Realistically, you may not be able to do both as extravagantly or as soon as you initially imagined, but perhaps sacrificing your 12-month trip for 6 months and allowing more time to save for a house would see both parties satisfied.

Investing is not gambling

You will gain financial success by steady, sensible decisions over many years, not by gambling on spectacular returns or picking a winner. The key concepts are:

Diversification (spreading your investment)
Buy things you understand (or use an unbiased professional who understands)
Invest within your risk comfort zone (where you can afford the likely ups and downs)

Before investing, do your research. Enlist the assistance of a financial advisor or seek advise from a trusted friend who is a confident investor. When it comes to investing, you can never know too much.

Increase your borrowing power

A $10,000 limit on your credit card reduces your home loan borrowing power by about $40,000.

If you’re interested in entering the housing market or need a loan, you can increase your borrowing power with a few quick and easy steps:

Improve your credit rating
Cancel credit cards or reduce your credit limit
Reduce your other debts

Avoid credit debt

If you need to borrow, avoid getting a short-term loan or pay day loan. They’re faster to process but harder to afford. In most cases you’ll be up for an establishment fee of 20% of the loan amount and an account-keeping fee of 4%. Take time to do the math: You could borrow $1000 for a month and find a cash advance from your credit card which would be about $220 cheaper.

Seek help and advice

Don’t be scared to seek advice. Whether you’re building your wealth, or things have gone horribly wrong, seek help from a financial advisor who is able to help you continue on, or get back on, the right path.

These tips were brought to you by Effie Zahos, Editor of Money Magazine, to celebrate the Australian DVD release of Money Monster.

1. Spend less than you earn

In order to invest, you need something to invest with. If you are one of those people who spend every dollar they have, then you aren’t really helping yourself. You need to review your budget and ensure that you are living below your means. Whatever excess income you have, will be what starts your investment portfolio, so make sure you take it seriously. You can start a portfolio with as little as $2,000, and a monthly contribution of $100 so making the adjustments to your spending could get you there sooner.

In order to get yourself investing in the New Year, there is a bit of housekeeping you need to do

2. Review and reduce your debts

If you have debt, then you need to review this asap. This may mean engaging a mortgage broker to review your home loan to see if they can do better, or upping your credit card payments to get rid of it sooner. Debts drag you down and inhibit your ability to throw excess cash into your investments. Depending on your situation, a credit card balance transfer might be worthwhile if you think that you can pay it down within the interest free period. This strategy could save you a heap on interest as long as you pay it off in time.

Whatever excess income you have will be what starts your investment portfolio

3. Keep your receipts

A hearty tax return is a great way to kick off your investment portfolio, but they aren’t always guaranteed. To put yourself in the best position to get a large tax refund, make sure you keep all of your potential tax deductions. A good accountant or tax agent will be able to tell you what you can and can’t claim, but if you don’t have the receipts, they won’t be able to help you much.

Debts drag you down and inhibit your ability to throw excess cash into your investments

4. Start an emergency fund

There is nothing like an unexpected nasty popping up to derail your perfectly laid investing plans. We can’t budget for everything as we never know what is around the corner, but having a ‘budget buffer’ will soften the blow. An emergency fund of $2,000 is a good starting point to ensure that life’s little gremlins don’t sap funds from your investing goals.

By making the above 4 changes to your finances, 2015 could be the year you start your investment portfolio. You can start small and build over time as the power of compound interest will be on your side. It’s about changing your mindset and realising that it is achievable. Committing to the right habits now will help to get you there quicker.

Cara Brett is the Director and Senior Financial Adviser at Bounce Financial. Having worked in the financial services industry since 2003, she saw an opportunity to work with the young professionals and the movers and shakers in Brisbane, and so Bounce was born.