To key to good money management is budgeting. Creating a monthly budget, so that you know exactly what money you have coming in and what you’re spending each month, will help you to see what you can cut back on when you need to as well as if there is anywhere you waste money. Once you’ve got a thorough understanding of what your monthly budget is you will begin to be able to control your finances better.
2. Reduce debtsFor many people the biggest financial stress they have is debts. Although when you have a lot of debts it can be easy to try and ignore the money you owe by paying the minimum amount each month and forgetting about it, but to really get control of your finances you should create a realistic plan whereby you aim to pay off your debts. Even if this plan means you won’t pay off all your debts for five years, it will help you to re-grain control over your debts and help you to see a day when you will be debt-free.
3. Savings planIf you have the money to spare each month, you should make it part of your monthly budget to put some money into a savings account each month. Ideally you should have enough money saved so that you can live for six months without working, however any amount of money saved will help to create a safety net for when those unexpected expenses come up. Thinking about the future and planning for unexpected events are important aspects of managing your money well.
4. InvestmentsAlthough putting money into investments is not the right choice for everyone, for those who are comfortable with dealing with the stock market it can prove to be a great way of earning some extra money. Investments, however, don’t have to be just about putting money into stocks or shares, consider investing in your career as well. The current economic climate means that no job is secure so think about going on extra courses to boost your qualifications and skills, after all your job is likely to be your biggest money earner so it makes sense to invest money into it.
5. Increase revenue streamsThe idea of having multiple revenue streams is well known in business, but increasingly financially savvy individuals are also looking for ways to increase their personal finances. Even if you have a full-time, well paying job there is often something you can do on the side that will help to boost your finances, helping you to feel less dependent on your 9-5 job.