Learning how to manage your money is one skill that never seems to go out of favor. We pay huge amounts of cash for others to manage our money but when crunch time comes, we haven't learned the skills to make an informed and profitable decision.

We rely on financial planners, mortgage brokers, and CPA's to help get us out from under debt yet we haven't learned how to avoid getting into debt to begin with.

The average person is approaching $10,000 in revolving debt and there is no end in sight to the excesses that fuel our credit hungry lives. We go for the fast buck instead of the smart buy and then pay for it later. Banks and loan companies are enjoying record profits as they approve more and more loans. It's a cycle that is costing consumers billions and billions of their hard earned dollars in interest payments and when the bubble finally bursts, many of these same consumers are going to be in for a rude awakening.

Bankruptcies are being filed in record numbers with nearly 5% of all credit card accounts being delinquent. This has put a major burden on our economy which can't seem to get out of it's own way.

So how can we avoid all these problems and acquire the skills needed to run our own financial affairs?

Here are 5 ways to become a better money manager.

1- Create a plan that you can live with.
The majority of consumers live paycheck to paycheck without knowing where all their money goes. Plan out your spending according to your ability to pay and budget your money when paying back loans. With no plan there is no way to realize your financial goals.

2- Do your homework before you buy.
The more research you do, the better the price you will pay, and the more value you will incur. Learning about what products you want to buy will give you insight into knowing whether that product is right for you or not and the pros and cons of each product.

3- Learn to save money before you buy.
As a country, we rank near the bottom in savings per person. Consumers in Japan and Europe consistently bank more of their paychecks than Americans. Spending does not build wealth only a lifetime of debt.

4- Use the proper tools to manage your money correctly.
There are free tools all over the web that will help you set up a budget, plan out your retirement, help you save money, do your taxes, even compare prices for anything you want to buy. When help is available, take advantage of it.

5- Take action.
There is nothing worse than someone who doesn't take any action at all to better their financial situation. Unless you make a concerted effort, you'll never get out of the situation you're in.

Relying on others to fix your money mistakes instead of being financially responsible for your own actions is a recipe for disaster. Our parents never learned how to handle their finances and they haven't taught their children to do so either. Unless we, as individuals, take the time to learn, we will always be financially illiterate.