Smart Way to Manage Your Finances


Managing your money is the best way to educate yourself to become financialy intelligent. You are the best manager of your own assets. Learn how to take charge of your own money and stop supporting lenders and retailers with cash that should be supporting you and your loved ones.

Here are some of the smart ways to manage your finances to reach your financial goals and become rich in the end. As they say, the early bird catches the worm.

 

Set goals for your gold. Set specific goals. Decide what specific financial goals you want to reach. Think about long-term goals like retirement. Also decide what to achieve in the next few years, what to accomplish this year, and what you can do in the next month.

Write all of these down, rank them by importance, and assign due dates. Next, estimate how much you must save to meet each goal. Figure out how much to put aside each week to reach your total savings goal and then write down specifically how you’ll make that happen.

Brace for Murphy’s Law. The Murphy’s Law states that anything can go wrong will go wrong. Open an extra account at a bank or credit union to store money for emergencies like a job lay off, car repair, and hospitalization expenses. A good amount to accumulate is a minimum of 3 months and a maximum of 6 months’ worth of take-home pay.

End monthly mistakes. Prepare for a monthly budget sheet. It coordinates your monthly bills and expenses with your take-home pay. But there’s probably no such thing as an average month, so outline each month individually. Be sure to include planned savings and treat these like required savings.

Track credit card purchases. Are you a spendthrift? It’s time to cut back. To decrease rampant spending, try this. Every time you use a credit card, write down the date, what you bought, and the amount charged. If you use several credit cards, keep separate sheets or columns for each. You’ll see at a glance how much money you waste.

Plan a fiscal year. Experts in personal finance strongly recommends laying out a yearly budget of planned expenses that aren’t part of your regular monthly bills – things like new glasses or contacts, insurance premiums, vacations, or annual club fees. Review a previous year’s spending and estimate what costs are likely to be this year.

Personal finance experts say that you must decide where you might cut back, then total the remainder and divide by 12. Now you can see how much to put aside monthly for these expenses.

Work together. Make budgeting a family affair. By sharing the information, you also share the burden.

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Tyrone is a passionate financial literacy advocate. He started this blog on November 2008 when he watched The Secret which talked about Law of Attraction because he wanted to become a millionaire and wanted to know how a millionaire acts. At the age of 26, he achieved his first million. To find out more about him, click here or follow him at Instagram

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