Money is mysterious. It should not be but it is. We live in a country where our education system does not cover the basics of money. We cover 17th-century history but not how to balance a checkbook or use a budget. We have people coming out of high school with no idea how money works.

They come to me years later drowning in debt looking to buy a home they cannot afford. If our schools had some solid form of financial education our country as a whole would be so much better off. My pet peeve is the lack of financial education in schools. It keeps me awake at night.

Can you tell?

Add to that the negative connotations spread through the media that if you care about the money you are a miser or cheap and you have a recipe for financial disaster. Watching your money and caring about having money is GOOD. I talk to people all day about money.

It is my job and I love it. From all these interactions I can tell you that people are suffering and not living the lives they dream of because they do not understand the basics about money and are concerned about the negative connotations of knowing too much about their money. Below are three items I feel are the absolute basics. If you are not already doing these. Please do and feel free to check in with me to let me know how it goes.

A budget is a great way to examine if you are living above or below your means. There are old school spreadsheets etc you can use personally I prefer mint.com It is FREE and If you pay your credit cards and have all your banking online Mint will be a breeze.

You literally put in all your accounts logins and it will analyze those accounts and create graphs showing you where you are spending your money. It is always an eye-opener the first time you look at that pie graph.

You can very quickly see where you are overspending and narrow it down not just to the category but actual store. It also has the option to set budgets for any category. This is a very easy way to see where all your money is going. Make it a game to see where you can cut.

If you are not a sports fan and watch minimal TV, a simple cut is to cancel cable and get Hulu. Hulu is like $8 a month. Have a landline and a cell phone?

Do you really need the landline?

In an emergency, you have a better chance of the cell phone working. You can go through and analyze these things and make cuts.

Starbucks your vice?

Have you tried a Nespresso machine?

If you make 10k net and are spending 10k a month you are setting yourself up for a miserable life.

Respecting your creditors is the key to a good credit score. Pay your bills on time or early. Never miss a payment. Think of most of your creditors as loan sharks.

If a guy in an alley with a bat said he would lend you a $100 but if you do not pay it back that month you now owe him $125 and he is going to tell everyone you are a deadbeat would you wait a month to pay him? No, you would not and yes credit cards can have interest rates as high as 25% and when you are late they report it to the credit bureaus.

You do have to have credit cards though. We have a whole new generation of people terrified of credit and living off the grid until they want a home. Guess what? No credit history = no loan.  Use credit cards for convenience and to build credit and get airline miles but pay them off in full every month.

If you cannot pay it off you should not be charging it. That is the hardest thing for anyone to learn. Let’s say it together; If you cannot pay it off you should not be charging it. For all my clients building their credit, I say put one tank of gas on the card every month and pay it off. That is it.

Save 20% of your net income every month. If you make $1000, that means $200 in savings per month. Make 20k?

That is 4k in savings per month.

It has to be automatic in your brain that the first bill you pay is to yourself and it is 20% of your net in savings. The normal thought pattern is to pay everything due and then buy whatever you want and then save.

That is the wrong way. Save first. Of course, you need to pay your bills but if you followed 1 and 2 this should be a breeze. Picture yourself as the guy in the alley with a bat and if you don’t save 20% then next month you have to save more.

Remember, you do not have to make a lot to save money. You just have to live below your means. Some of my best saving clients make less than 100k a year and they are not extreme cheapskates.

Money is not mysterious. Banks and creditors would love you to think that it is very complicated but it is not. Don’t fall into the consumer traps. Understand money and use it to get what you want and to insulate yourself and your family.