When it comes to personal finance advice, there’s so much information out there. It can be dizzying to sort through personal finance podcasts, books and blog posts. I mean, which personal finance experts should you trust? And where do you go for some easy-to-understand personal finance tips?
In comes Reddit.
Reddit’s user-generated content is free and can be a good source of information if you want to improve your financial situation. It’s easy to get a quick tip on retirement plans like Roth IRAs, grab some general free financial advice, and even read what people who have achieved financial independence suggest.
The Best Financial Advice from Personal Finance Redditors
We’ve selected awesome financial advice from the Reddit subreddit r/personalfinance. We even scoured through posts and comments to find some gems to help you take action with your money. Are you ready? Take a look at these 20 financial tips from selected Redditors.
1. Save or pay off debt based on your situation – by Zambenis
Should you save or pay off debt? It’s an age-old question and the answer can vary. This Reddit user shares the nuance of the situation. If your job is secure and you have strong relationships, an emergency fund of up to three months can be a good start. This way you can focus on repaying debt. If your employment situation is less stable, saving a larger emergency fund is a better option before going beast mode on your debt. So, build your emergency fund based on your situation and work toward getting out of debt.
2. Save and invest automatically – by flat_top
We love this post because we also believe in paying yourself first. Most people spend first and then feel like they have nothing to save. Here we are reminded that we should save and invest first, and then see how much we can spend on everything else. Automatically saving can help you do this. Using Chime, you can automatically save 10 percent every time you get paid. You can also round up your purchases so you’re saving every time you spend.
3. Budgeting can help you avoid credit card debt – by dajesus77
Have you ever checked your bank account and winced? Have you ever wondered just how much you charged on your credit card? Keeping yourself in the dark about spending can lead to debt. That’s why a budget is a perfect antidote to keep your spending in check and avoid credit card debt. To start, create a budget, track your expenses, and check your bank and credit card balances every day.
4. Not investing can cost you money due to inflation – by GivemetheDetails
Let’s face it, investing is scary. There’s risk involved and so many factors outside of our control. But keeping all your money in cash and not investing anything is not the wisest choice. So, start by figuring out your risk tolerance and investing some of your money, while also keeping some of your money liquid in cash savings.
5. How to get a credit card with limited credit by BrunedockSaint
It’s a catch 22. To get approved for a credit card, you need to have credit history. But how can you build credit history if you’ve never had a credit card and no one will give you one with no credit? Here, the Reddit user shares his or her experience in banking and getting a credit card with limited credit. For starters, get a card from your bank, use a co-signer, get a store card, or even a secured card. The key is to repay your balance in full and on-time.
6. Advice on getting out of debt by PacificNorthLeft
Ready to get out of debt? It’s time to ditch those extra expenses (for now) and budget. Pick a debt repayment method, like the debt avalanche method where you focus on eliminating your high interest debt first. While paying off debt, you can still save for retirement, even if it’s a small amount. It all starts with saying goodbye to some expenses and having a plan.
7. Saving is only one part of the equation, focus on earning more too by – gregaustex
Personal finance advice tends to favor frugality. Save money! Ditch lattes! We dig frugality too, but it has a plateau. There’s a limit to how much you can cut back. This post reminds us of that and advises us to maximize our earnings too. So that means asking for that raise, earning more through side hustling, and starting that business. Saving is just one part of the equation — earning more is another part.
8. Best way to pay extra on a car loan by hrds21198
Do you have a car loan and want to pay it off fast? It’s best to call the company first. This Reddit post notes that sometimes extra payments are applied to interest and not the principal. To make sure your extra payments are going where you want them to, give the company a call and say you want to pay more toward your auto loan and you want it to go toward the principal balance.
9. Simple student loan advice by article4freeman
There’s so much student loan advice out there. Here we have simple advice. Save up a few months of expenses as a cushion, then pay off your student loans fast. After that, take the amount you put toward debt and save and invest it.
10. Start Investing in a 401(k) by KermitMadMan
You know you should be saving for retirement and one easy way to do that is through your 401(k). But how do you get started? First, make sure your emergency savings is covered. If your company has a 401(k) match, contribute enough to get the match. The key is to start somewhere and keep building.
11. Best financial tips to manage money and move out by mormengil
When you’re just getting started with adulting, managing your money can seem hard. How do you get started? How can you manage your money to move out of your parents house? This post gives a step-by-step guide on where to put extra savings and how you can manage your money and prepare to move out.
12. Fixed or variable interest rates by DaTower75
If you’re about to take out a loan, you probably will choose from a variable or fixed rate. Which one is better? Although variable rates may be lower, interest rates are likely to go up, so locking in a fixed rate can be a good option.
13. Create a “fun” savings account by Jrlutz31
Here’s some advice we can get behind. Create a “fun money” savings account! No more guilt about having fun. It’s in the budget. You have the cash. Start by saving automatically and setting some money aside specifically for F-U-N. Having fun with your money can help you enjoy life and may even help you stay on top of your other financial goals because you don’t feel deprived.
14. Getting out of overdraft fees by clearwaterrev
Overdraft fees suck. This post helps share how you can waive those pesky fees and get rid of them if you’re in this situation. You can also choose a bank like Chime which has absolutely no fees.
15. Know where your money goes and how to budget by tracking by xaradevir
Many of us have thought, “Where the heck did my money go?” It happens. This post reminds us to track, track, track. Track everything. Start by going through all your expenses over the past month. Write down ‘need’ or ‘want’ and evaluate where you can cut back. You can’t improve your financial situation unless you really know what’s going on with your money.
16. Don’t try to time the stock market by KCPilot17
In this environment, people are starting to lose their minds over the stock market. Is another recession coming? What should you do? Keep it simple. Stay on course and don’t try to game the market. Think long-term, not short-term, and stick with the plan. Avoid emotional reactions to the market and know that the stock market can recover in time.
17. Building credit with credit cards the right way by owari69
Credit cards and building credit can be confusing. Yet, it’s fairly simple. Get a card and pay it back on time. Over time, your credit score will improve. It all starts with using credit responsibly. Pay off your balance in full by the due date. Keep your balances low. Only borrow what you need.
18. Don’t take on debt just to build credit by JsLadder
So, you may need some type of credit to build credit. But you should never take on debt and pay interest just to build your credit. You don’t need to take out a car loan just to improve your credit. There are other ways to do this. For example, you can start with a secured credit card or only use your credit card for groceries and pay it in full.
19. Max out retirement by the end of the year by acosmichippo
By the end of the year, there are ways to maximize your money. It’s the best time to max out your 401(k) contributions and HSA. This advice is simple and to the point.
20. Tips on how to get a raise by buyabighouse
As noted in another one of these Reddit tips, earning more is part of the financial equation. This can be done by asking for a raise. But, how do you that? Start by doing research on Glassdoor or Payscale to see what the market rate is for your position and your area. Keep tabs on your accomplishments and at the right time, talk to your supervisor about a raise. It can be uncomfortable but growth always is!
Read to improve your finances? You can start by checking out these 20 Reddit personal finance tips on everything from paying off your student loans, building your credit score and asking for a raise. What financial tips would you add?
This page is for informational purposes only. Chime does not provide financial, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for financial, legal or accounting advice. You should consult your own financial, legal and accounting advisors before engaging in any transaction.