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The main key to financial health is to spend less than you earn. This is what true wealthy people do, regardless of income. We actually live in a time when this is pretty easy to do. If we examine our spending habits, there are usually things that can be cut. Also it's not that difficult to increase income. Side jobs, overtime, temporary second jobs to pay down debt, even yard sales and selling things on-line can generate extra cash, which can be used to pay down debt, or put in an interest earning savings account, which will also generate more cash. Following are some useful tips:

1. Get a grip on spending-Find out where your money's going. Don't buy things you can't pay for outright. Do some budgeting and planning. Find out what is really important, and what you really need. Don't create more debt!

2. If you have debt-create an aggressive plan to pay it all off. The easiest ways to do this are a combination of trimming down spending, while also generating additional income. Choose a debt such as your smallest amount owed, and put everything extra into it until it is payed off. Then take the next debt, and put everything into it, plus whatever you were paying on the previous debt. After a while all small debt will be paid off. And if you continue at this pace your largest debt, (usually the mortgage), can be paid off in 5 to 7 years. Imagine what you would do with all that extra cash, having no mortgage or other payments, for the rest of your life.

3. Have that emergency fund ready-A good way not to generate more debt, is to have an emergency fund such as 3 to 6 months living expenses, in a liquid account such as a money market fund. Plus you can get about 5 percent interest on some accounts right now.

4. Make a plan-spend some time each week working on your finances. Plan spending choices, debt reduction, and investing for the future. Once you are on a solid financial footing, invest that extra money, with the power of compound interest, your money can work for you. Instead of you working for it.

5. Educate yourself-Nothing can motivate like knowledge and knowing the potential your actions can produce. Study and learn about money and you will make the right choices. Plus things like watching the Suze Orman show, or listening to Dave Ramsey. Can keep you motivated and moving in the right direction. Good Luck

Learn more about this author, Emma Nelson.
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