You’ll hear others give out advice unsolicited about managing your finances. Although some of this advice may make sense, most of it is generic and does not take into account important points. You should not rely too much on such unsolicited advice, since much of it may not really be very accurate or useful.
How can you take good care of your money and your finances so that you do not end up frittering away your savings on things you don’t need?
The Issue: There are quite a few individuals who simply do not understand what it takes to save money for the future and the value it holds. The most common scenario is, you spend money whenever you get your income, and just save whatever left in your account for that pay period. Sure, this is much better than not being able to save at all, but this is not the best way to save.
Effective Management Of Your Finances
If you want to save money for your future, you’ll want to consider these tips. Many successful people have found that this is a great method to use.
Save 20% Of Your Earnings
It all begins with the savings that you have and what you are keeping aside. Rather than spending and then saving the leftovers, save first and then use what’s left for spending. Always put 20% of the money you earn in a piggy bank, separate wallet or especially established savings account. You should not be looking to spend this on a nice pair of shoes because you require this money down the road.
By doing this little trick, your budget will be easier to work with and you’ll be saving some money for your future. It would certainly be nice to have that kind of money for whatever comes your way.
Stick With The Basics
There are too many people that are going to look at the latest gadgets and get wooed. Many of your colleagues and friends have it, but you only bought your model a few months ago. All these latest gadgets look so appealing, however that doesn’t force you to buy one, except when you REALLY NEED it. Question your need for it.
What can the new phone do that your old phone can’t? There are times where you can spend, but in essence, you should be focusing on saving money. Only when you know you have some extra left, you should be spending money, and of course, that excluding the 20% for saving.
Use Cash Not Credit
Oh those shiny credit cards look pretty and they’re meant to be used and not just take up space, right? Many people always accumulate the debts by making small purchases using their credit cards. You may think it would be fine to spend $50 on a dress because surely you’ll be able to pay it off by the end of the month. This is so wrong because all those times add up, even when it’s ten dollars at a time.
Pay cash, as far as is possible. Credit cards should be reserved for genuine emergencies. If you prefer, use debit cards in place of cash.Budget and personal finance management can be easy. It just takes some discipline and refocusing your attention.