When I was younger, and my career was starting to take off, money management wasn't a priority. Things were going well financially and I went out and purchased a car that wasn't exactly practical and started doing some traveling. Of course, the good times didn't last and I had to drastically change my lifestyle.

While I was able to rebound financially, it took some time to get back on my feet. I had a lot of debt and not much money saved. Thankfully, I learned from my errors and have made money management a top priority, so that I'm not put in that situation ever again, by using the following eight tips.

1. Delay gratification.

This is arguably the most challenging obstacle when it comes to money management. After all, in most circumstances, our emotions cloud our thinking. For example, it's easy to want to go on a shopping spree when you've just received your paycheck, but you have bills and more important expenses to worry about first.

Instead, you need to delay gratification. It's actually a tactic that wealthy individuals practice: Only purchase an item if you have the money for it. In other words, instead of using your credit card for a new wardrobe, smartphone, or vacation, save up this money so you can make the purchase in cash. Even if you need a credit card to make the purchase, you should at least have enough cash in the bank to pay off the card immediately. Those interest rates can really do a number on your finances.

2. Track your spending.

Take a couple of minutes and write down every penny you spend each month and how much cash you're bringing in--a.k.a., create a budget. Do those expenses exceed your income? If so, it's time to start trimming the fat.

Creating a monthly budget isn't as complicated as you might think. As mentioned above, it basically just shows you where all of your money is going each month. After you've listed each expense, you may realize that there's some wasteful spending on your list, like the monthly gym membership you rarely use or an outrageously expensive cable bill. Cutting those small expenses can improve your financial situation in no time, since it not only reduces your spending, it can also keep you on track when achieving financial goals.

If you need a little help with tracking, planning, saving, and even investing your money, there are budgeting apps such as YNAB, LevelMoney, PocketGuard, and Spendee that you need to try.

3. Prioritize your bills.

Most of us have monthly expenses like rent, a mortgage, insurance, utilities, and a credit card. Even if you have enough money to cover these expenses each month, it's easy to miss a due date when juggling all of these bills. The result? Late fees and expensive interest rates.

To stay organized, you should create a calendar so that you know when each bill is due. Make it a priority to send out a check at least seven to 10 days prior to the due date so you don't get hit with late fees. Better yet, set up recurring payments, so that the amount due is automatically withdrawn from your bank account. This eliminates the need for writing a check and mailing it--which saves you time and money, since you don't have to pay for postage.

Keep in mind that when prioritizing your bills, creditors come last. Your top priorities should be essential expenses like rent and utilities. It's kind of difficult to work from home and make money when you don't have the electricity or heat on--or an internet connection!

4. Build an emergency fund and start saving for retirement.

An emergency fund comes in handy if you lose your job or have a sudden and unexpected expense, like a medical emergency or replacing work-related equipment. If you don't have the cash to pay for these expenses, you'll probably turn to your credit card--which ultimately puts you in further debt.

Furthermore, you should also be setting aside money for your retirement so that you don't have to be concerned about your future. The first thing to decide when planning for your retirement is what kind of lifestyle you want down the road. This varies from person to person, but it will guide you in setting aside the appropriate amount.

To make saving easier, consider automating your savings. This means that you decide on an amount of money to be automatically deducted from your paycheck and placed into a money market or IRA.

Since this money is taken out automatically, you don't have a chance to spend it. It's suggested that people place 10 percent toward investments and 5 percent toward savings.

5. Understand tax basics.

Whether you're employed by someone else or self-employed, you're responsible for taxes. For example, income taxes. This varies across the country, but it's important to know how much is taken out of your paycheck so that you're positive that you're earning enough to meet all of your financial goals and obligations. Thankfully, there are payroll calculators, such as this one from Paycheck City, that can help you out with this.

Additionally, understanding your taxes also means that you may be eligible for tax deductions. For example, if you're a freelancer who works from home, you may qualify for a home-office deduction and even deductions for some of your utility and cleaning expenses.

6. Don't pay full price and put more cash in your pocket.

Here's another secret from the wealthy: Never pay full price. Believe it or not, some of the wealthy use coupons, wait for sales or promotions, and shop at locations like Walmart or Target, not luxury retailers like Tiffany & Co. or Brooks Brothers.

Besides never paying full price for the items that you need, you can make money off of your past purchases through reward sites like Ebates, selling your old gadgets, and renting the stuff you're currently not using, such as a spare bedroom, parking space, or household items.

If you really want to put some extra cash in your pocket, pick up a side gig that you can do whenever you have spare time.

7. Borrow wisely.

Credit is actually a good thing, since it can be used to make larger purchases, such as a car or home--you can even earn cash back and rewards. However, borrowing money to purchase smaller items, like furniture for your home or office, or using a credit card to buy a car can come back to haunt you. For example, if you have a $10,000 credit card bill with an 18 percent interest rate, and you make only the minimum payment of 2 percent, it's going to take you 40 years to pay off that credit card.

In short, use long-term credit for larger purchases and short-term credit for purchases that can be paid off quickly.

8. Protect your wealth.

One of the worst things that can happen is having your hard earned money suddenly disappear. To prevent this, take precautionary steps to protect your wealth.

If you rent, make sure you have renter's insurance in order to protect the assets of your home or office from unexpected events like burglary or fire.

Disability insurance will ensure that you have some income if you're unable to work because of an injury or illness.

Published on: Jan 30, 2017