The last few years have been highly stressful for society as a whole. And as it happened, the COVID-19 wreaked havoc on the financial world, making personal finance a misery for most of us. Unfortunately, recent events in Europe show that we are still not out of the woods and that the coming years may bring much worse financial difficulties. Given the current state of affairs, the only rational course of action is to begin planning for these challenges and creating sound financial practices for the future. So, let's see what we can accomplish by the end of 2022.

Keep track of your expenses

Tracking your expenses is a smart first step in financial planning. Know where and how much your money is going. Looking at things from a different perspective might sometimes help you comprehend them better. So, look at your income and expenses from a larger perspective to see what may be trimmed, and then restrict your emphasis to spending optimization. If keeping track of all your expenses becomes too time-consuming, expense management applications can help. Because the applications will keep track of all your transactions, you will be able to examine your expense profile better and prioritize your spending. Given the world's recent shift to digital purchasing, expenditure management applications can be helpful for people seeking to keep track of their spending.

Start investing

Yes, the best time to have started investing is yesterday, but that does not mean you can't start now. Don't try to cover all your bases at once and instead make small investments every few weeks or months and use a system like Systematic Investment Plan, which is simple and effective. SIP is a good way for regular investors to invest in mutual funds. It is akin to a recurring deposit, except it's linked with the market, and you can choose any amount you want. Once you get the hang of it, you can start investing in various financial products. We recommend low-risk mutual funds and keeping your goals long-term in mind. Other reasonable choices for people looking for lower-risk investments are fixed deposits, recurring deposits, pension funds, etc. Compounding rewards should not be underestimated. There's a reason why slow and steady wins the race. However, market-linked financial programs have more risk. You must develop an appetite for risks that correspond to your company's goals. When investing, don't get discouraged by your fears of missing out on future growth. It's equally important not to make an emotionally-driven investment decision from a fear of running out of time or defaulting on what you've already invested in. Financial markets are risky, so always do your research and never rely solely on advice from others. Patience is a valuable skill.

Check your options

Most people avoid taking out loans because they are afraid they won't be able to repay them if things go wrong. However, relying only on personal resources to overcome financial challenges might lead to some abysmal long-term decisions. This can be avoided if you understand what you're getting yourself into and use loans to solve specific concerns. Companies like Jacaranda Finance, for example, provide a variety of low-interest short-term loan solutions that allow you to deal with acute financial difficulties without putting significant weight on your future finances.

Round up your transactions

One last money habit to attempt is so straightforward that you'll wonder why you didn't do it sooner. Rounding up your transactions is a simple approach to saving money for retirement, debt repayment, or other financial objectives. There are two possible outcomes. To begin, you can contribute to your savings by rounding up unused funds in your budget. So, if you planned to spend $500 on food for the month but only spent $475, the remaining $25 can be saved. Another option is to round up your purchases as you go and save the difference. If you spend $33.50 on lunch, for example, you could round it up to $35 and save the extra $1.50.

The advantage of this practice is that it allows you to expand your savings by making small deposits without making significant lifestyle changes. It may not appear to be much, but you'll be shocked how quickly it adds up over time if you're generating interest on your savings.