One of the best life lessons about finances I learned as a mother is to address them head-on. I quickly learned that I couldn’t bury my head in the sand when things got tough, as it just made everything worse in the long run. When you know exactly where you stand, and you have a plan in place, you experience less stress. Here are some of the other lessons I have learned through times of financial adversity.

Knowledge is power

Learn as much as you can about finances and you will be able to avoid certain financial pitfalls and identify opportunities. When I decided to stay at home to look after my children, my family lost a portion of household income.

I began to research how I could save and make more money. Reading various books about finances made me realize that we could use our home as equity to buy a rental property. Now the regular rental income exceeds what I was earning in the workplace.

Manage your money meticulously

Today, there are various apps available to help you track your expenses, income and much more. I personally use an app that helps me to manage my finances better. It automatically updates and categorizes my transactions and creates a picture of my spending in real-time. I can use my own categories, track my bills, set budgets and get free credit scores.

Have a good credit rating

Without a good credit rating, you will find that you may overpay on mortgage interest payments and be rejected for loans. Lenders want to know that you’re responsible with your money and your payment history makes up 35% of each credit score. This is where Kikoff can help you to build credit for free. Build a record of on-time payments to show credit bureaus without the need for a credit card.

Credit card debt has very high interest rates and it can quickly spiral out of control. When I started my first job, I had a credit card that I maxed out and then spent years trying to pay off. I learned that a credit card must be paid in full every month to avoid the high interest charges and that it was better to live without one if possible.

Model good money management

As a parent, you are a role model and your kids will look at what you do and learn from you about money. Instead of giving our kids an allowance, my husband and I decided to pay them for doing certain tasks.

When they receive any money, we encourage them to put it in three jars – spend, save and donate. The save portion goes into a savings account and we match the amount at the end of a year. This enables them to buy larger items and experience the reward of saving.

Shop smart

I have learned that there are deals to be had if you’re a smart consumer with plenty of patience. I have learned to buy clothes or other items I know will last, as this saves money over the long term. Thinking about whether I really need something or I just want it has prevented me from making some questionable purchases over the years and saved me money.

It has taken me years to become a financially responsible person and it happened as a result of many trials and tribulations. I think the biggest lesson I learned was to face my financial situation head-on, understand as much as I could about finances and learn to manage my money instead of living in ignorance and fear. When I’m on top of my finances, life is good.