by Elizabeth Wordsmith

Created on: February 02, 2009

Stop wasting money and build savings by taking control. Money slips through our fingers like water because we don't grab hold of it and make it a tool. If we don't learn how to use it and make it grow, there are plenty of people out there who would love us to part with it for their benefit. So, take charge and follow all or some of these twenty tips to master the art of money management:

1. Determine your net worth. Add up your equity in properties and cars. How much do you have in savings and retirement accounts? Do you have any stocks and bonds or other paper assets? Include in your asset column the value of furnishings, jewelry, clothing, art, and other possessions. Now deduct any debts and mortgages.

2. Determine your monthly and yearly income after taxes.

3. Gather up your bills and set up a budget. Don't forget to include occasional expenditures such as yearly auto registration and professional licensure expenses which are usually every other year.

4. Subtract your necessary expenses from your monthly income to determine what is left over for savings and discretionary spending.

5. At the beginning of each pay period, put a portion of your earnings into savings. Everyone should have some money set aside to take care of unexpected emergencies. Ask yourself if you would have enough cash on hand to get you through if you lost your job. Even if you are able to collect unemployment, it may take some time before you receive the first check. Personal finance experts recommend having at least six month's earnings in a savings account.

6. Examine your current discretionary spending habits. What do you spend on entertainment, eating out, vacations, and gifts? Set up a budget for those types of expenses and try to keep them as minimal as possible. Do you spend money on dry cleaning services, pool service, having your car detailed, and so forth? Which of those services could you drop completely or reduce?

7. Look at last year's tax return. What can you do to increase your tax deductions? Can you make the maximum contribution to your IRA? If you are planning on purchasing a new car, do you know that you can get a tax deduction if you purchase an energy conserving car?

8. Check your credit score. Improving your credit score may reap benefits such as lower interest rates on credit cards and some other bills such as insurance.

9. If you have a home equity loan, you can deduct a portion or the entire amount of the interest portion. Also, the interest rates are low on home equity

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