Managing your money well is one of the most important tasks you do, particularly in today's struggling economy. While the employment market is booming, not all jobs offer a high enough salary to manage rising costs and with benefits being increasingly difficult to claim, the number of people losing their jobs, losing their houses, and declaring bankruptcy are alarming.
Coming up are just a few pointers to help you manage your money and plan for the future.
Make a list of your objectives.
Setting realistic financial objectives is the first step toward better financial management. Every individual will have a unique set of objectives.
Perhaps you're putting money down for a down payment on a house, a trip, your child's schooling - it's important to look at where you spend your money now. Spending can rack up, from micro transactions on things like Candy Crush to playing online games on sites like casino online NetBet so it's important to set a budget for all the things you enjoy while creating a plan for your long term goals. Having a budget and setting goals will help you to avoid overspending or misusing your money and therefore, you become more responsible with your finances.
When establishing your objectives, bear in mind to be as detailed as possible while being practical. If you earn £30,000 a year, it will be hard to save up to £20,000 for a deposit on a new home in one year, so make sure your objectives are realistic.
Make a financial plan.
Even though you will hear it repeatedly, a budget is the most critical tool for managing your money. Make certain that your objectives are included in the budget and that you provide some wiggle space. If you make an unforeseen purchase of £10 that causes you to go over your budget, it will be more difficult to stay on track.
Make Use of the Available Resources
There are a good number tools available to assist you in managing and maintaining control over your money. Check your account regularly by using online banking services.
Create your budget and keep track of your spending using budgeting software such as Quicken, Microsoft Money, or simply Microsoft Excel.
Micro-Manage
This is particularly critical when you are just getting started. Keep a record of everything you spend (including cash transactions), or enter your spending into a financial management software program to keep track of everything. Not least, it will help you identify how much you are spending casually without even thinking about it.
Assess how your actual spends compare to your budget, and make adjustments if necessary. You may find those 'few pints' were actually eight, or that those quick breakfasts on the way to work added up. Try and look in with your budget at least once a week to ensure that you are still on track.
If you have debts, prepare a plan for paying them off, and take specialist advice if needed.
Prepare for Unexpected Situations
It's important to prepare for the unexpected. Make sure your budget accounts for unexpected events like a car emergency, such as a puncture or MOT failure - or the need to take unexpected sick leave. Be aware too, that things like car insurance can go up, or if you have an accident, you may have to pay an excess. By putting aside a small 'emergency fund', the everyday events that happen to all of us at some point won't have a long term financial impact - and having a small amount of money put aside for this will always be better for your financial health than using your credit card or taking out a loan to pay for these items.
Conclusion
Taking charge of your money may be a daunting task. The fact is, however, that it is the most significant factor in preserving your happiness and way of life. With these straightforward suggestions, you can better manage your money and plan for the future.
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