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As the month starts the first thing that comes to our mind is “How should I manage my finances this month?” This is the most common question for every household – especially is you are a salaried individual. It is highly essential for every single person to know the answer for the question “what can you do to manage finances?” However, it is obvious that there would be some unexpected incidents and expenses appear almost every month and we cannot help it but to face it. But if we can plan for at least the regular stuffs that are mandatory for month after month it would help us in tackling the situation in a better way.
According to one of the studies by TIMEabout 58% Americans do not have any retirement plan. I’m writing this article from my personal experiences. Before I started the exercise it was more of an unorganized spending, but after reading a few articles I tried the below few tips as a testing and it worked out well for me as far as managing finances is concerned.
Make a budget: Keep track of all your expenses for a month. It doesn’t mean that you need to limit yourself. This exercise is to only get an idea of your spending during a given month. Make sure you save all the receipts and make note of your cash requirement versus your expenses. Post that figure out the amount of money you are left with when the calendar page turns.
Spend money successfully: Spending your own money successfully signifies thinking wisely before you spend. Always make a smart move before just shedding out your hard-earned money from your pocket. Here you need to understand and successfully analyze between “need” and “want”. If you are able to prioritize “need” over “want” it will help you save a considerable amount of money.
Make smart investment choices: Investment is the key for your future financial requirements. Make yourself familiarize with various investment options available. You might think what would be the benefit of knowing the investment options and approach a service provider to invest in some option just for saving tax. That should not be the approach. You cannot learn swimming unless you get into water. Go ahead to explore and learn about various investment options available to make a sound decision as per your requirement.
Build savings: Start this exercise by putting away as much of your excess income as possible. Ensure to make savings a high priority in your life. Even if you have a small budget, twist your finances a bit so that you can save more than 10% of your total earnings for the month.
You might think that with all the above tips where the room for enjoyment and entertainment is. Yes, that is quite obvious to think – after all we are earning to live our life and you should give that a priority too. The only thing that should be kept in mind is to be a bit more organized in managing finances so that you need not to compromise in any aspect – be it present or in future.
