Your money and how you manage it are some of the most important things in your life, since they influence where you live, your car, and almost everything you do, and we understand that can be stressful. Of course, it is very important that you manage your money properly. Here are just a few relaxed steps you can take to start managing your money and improve your finances, avoiding major debt.
An obvious one is, start tracking your spending. The first thing you need to do is determine where your money is currently going and who to? Take time to see what you are actually spending your money on. Don’t worry, there will likely be a few surprises! We’ve all done it, remember that. You are most likely spending more in some areas than you think, and the smallest expenses can add up.
The most effective way to start tracking your money is to keep receipts and write your expenditures down on paper, or use a spreadsheet on the computer. The spreadsheet is more simple than you think! Just take a bit of time to get to grips! It’s probably the most pain-staking task in this, but definitely worthwhile.
The important thing is that you record what you spend as soon as possible to keep your records accurate. Yes, that still means keeping an eye on, and recording your guiltiest spends! Again, don’t panic, it’s all good practice, and you’re just trying to see where your money’s going right now. You don’t need to worry about good or bad spending yet.
Set up a budget, or a spending plan. To manage your money properly and get ahead financially, you need to spend less than you earn (which is much easier to do than you think…trust us). Record your sources of income and when you receive them. Then determine how much of your income is spent on monthly bills and necessities. Plan how you will spend or save any remaining funds.
After tracking your spending for a month, you will likely see some categories where you can cut your spending and keep your budget on track – don’t be afraid to make these cuts either – they are going to be worth it! When making your all-important budget, remember to plan for irregular bills such as pesky car insurance and set aside some money for unexpected expenses.
Make sure you review your budget every few months or whenever there is a significant change in your income or spending. Saving 10 per cent of your income is a common goal and is a good amount to start with.
Last but not least for our tips, if you don’t always pay off your cards every month then stop using them. One way to do that is to not carry them with you. Again, much more difficult than you might imagine, at first. You can hide them if they are tempting you! It might sound strange, but if you do not use credit cards then you can’t spend money you don’t have and will not be spending more than you earn.
Once you start managing your money, you will find out that it makes other parts of your life easier as well.
There is help and advice out there! If you are in debt and need help managing your finances, visit.