There are two main ways you can improve your personal finances. Earn more, or Spend less. The smartest secret way is to increase earnings while saving on unnecessary expenses.

There’s more to being financially independent than telling yourself you can’t waste money on the things that you want or need.

Although it’s true that you’ll need to develop a budget and follow the rules that you set for yourself regarding money, true success with cash comes from an ability to understand how to make the right decisions about your future.

Your personal finance is the term used to describe how you manage your cash in the present, and how you plan to reach your goals in the years to come.

If you’re ready to get your personal finance strategy back on track you need to first make these 3 important decisions we will share below.

3 Decisions to Improve Personal Finance:

1. What You Want to Accomplish?

It’s much easier to make real changes to your financial situation when you have a specific goal to look forward to, such as having a healthy savings account. Targets give us something to focus on when we’re tempted to spend extra out of our weekly budget, or we want to ignore our savings one month.

While the goal to be more financially savvy is an honorable one on its own, it’s much easier to choose something that you can properly visualize. For instance, you might decide that you want to put a deposit on a new home in the next five years, or you might pick the goal of buying a brand new car for you and your family.

Whatever you select, make sure you can envision reaching your targets.

2. How to Pay Less on Your Loans?

Loans are one of those things that most of us wish we could live without. Unfortunately, the truth is that unless you’re lucky enough to have a wealthy family or an endless source of income, there’s a good chance that you’re going to need to borrow money from a bank or building society at some point.

Used correctly, loans can be an excellent way to gain access to the things that you need and spread out the costs of big purchases. However, lending money can quickly become a problem when you’re paying over the odds for your interest.

If you got student loans a few years ago when your credit situation wasn’t as good as it is today, now could be the perfect time to make the decision to swap your loans for something with a lower interest rate.

3. How Often You’re Going to Update Your Strategy?

Finally, it’s important to remember that life is an ever changing and unpredictable thing. The plan that you have in place today to become more financially independent might not have the same positive impact on your behavior five years from now. It’s important to keep looking at your plan and your budget to see if it’s still working for you.

A good rule of thumb is to check your budget every month to see whether it’s working and get in depth with your financial strategy at least once every three months.

You can also check your plan more frequently when major changes happen in your life, like a change of career.