Wise money management is essential for a balanced, happy life. Financial stress resulting from poor money management skills can affect our capacity to make good decisions, harm our relationships, affect our physical and mental health, and ultimately to function well in life. It is no exaggeration to say that poor money management breaks up marriages and breaks down hope. Yet, money management is one skill which we can learn so easily. Even if our financial problems are largely the result of just not earning enough income, good money management skills can greatly reduce the stress of these circumstances and provide us a bit more mental room to focus on solutions.
Now here are six tips for managing your money wisely, which, if applied, will improve the overall quality of your life:
- KNOW WHERE YOUR MONEY IS GOING. It is important to stop the financial leakage. We all know what it is like to have our money dribbling away one coin or one note at a time. It is important to pay attention to our spending. It can be very helpful to record all expenditure for a set period of time just so you know where your money is going. At least, do try this for a month even with just a small notebook where you list down every single centavo you spend. Prepare to be shocked. Most people have no idea how much money is being lost to unnecessary expenses. You see, from the list you’ve made, you may now identify those expenses that are most often than not are just wants and not really needs. So once you know where your money is going, you can curtail those unnecessary expenses especially on your wants and you’ll know that you can now find a way to live below your means and start having some extra money you can use to increase your cashflow.
- DESIGN A BUDGET THAT WORKS FOR YOU AND STICK TO IT. You can design your own or get a free budgeting form off the internet. Make sure that at least some of your money goes to debt reduction and savings. Create a budget that will meet your financial obligations. If you have to cut down on certain expenditures to live within your budget then by all means, do so. Once you remove the stress of financial insufficiency through good money management, you will find that you are able to improve your financial circumstances gradually. This is next to impossible when you are overspending.
- PAY YOURSELF FIRST. Treat yourself as your most important creditor. Determine an amount that can be saved weekly, fortnightly or monthly for long term purposes and emergencies and save it regardless. Somehow, we always manage to find the money for paying our monthly bills for the rent, electricity, water, phone and etc. So decide to find the money too for savings. Better yet, make it a habit to first save 20% or more of the money you get before you spend the rest to pay for your bills and other expenses every month. This money management decision is certainly life changing as over time it will lead you to financial independence.
- AUTOMATE YOUR PAYMENTS. When things get stressful and we become overwhelmed with financial worries, our financial affairs can get out of control very quickly. Internet banking can solve a lot of this problem. Nowadays, most banks offer online or mobile banking. So, why not take advantge of this? If a part of your problem is that your income is inadequate, then automate some or most of your payments. In doing this, you’ll have financial discipline that helps release the stress of having to find the money for a lot of different payments. Now, you may still be short one or two payments but you’ll find that it is easier to look for a solution for one or two payments as opposed to six or seven. So effectively, automating your payments really saves you time and stress and helps you to take control of your financial affairs.
- PAY OFF OR CONSOLIDATE DEBTS. Nowadays, it’s really so easy and convenient to borrow money for just about anything. But remember, all debts need to be paid with interest. Once in debt, we have money working against us and it’s not what we really want. It’s best to have our debts fully paid once and for all. But if we can not do it just yet, then why not consolidate your loans? If you are able to consolidate a number of debts into one loan at the lowest possible interest rate, your monthly expenditure will decrease, sometimes by a lot. If you own your own home, you will be able to get a home equity loan at comparatively low interest, which is a better option than a personal loan.
- USE MONEY FOR THINGS OF LASTING VALUE. So much money is spent on items that have no lasting value and give no lasting pleasure. Many of this spending is at the expense of those things that actually do matter and will really benefit us in the long run. So the next time you get money to spend, why not use it to buy your short and long-term healthcare and your life protection? Why not use it to build your emergency fund, educational fund and retirement fund? You may want to use your money to also grow your wealth through investment in stocks, mutual funds and real estate. You see, if you want to feel a lot happier, fulfilled and at peace with yourself, then start using your money for things that has a lot more value that really matters for you.
Using these money management tips can greatly improve the quality of your life. These money management tips can actually help you take back control of your finances, reduce your stress, inrease your savings and make better long-term decisions regarding your personal finances. So if you’re really serious and you find these things important to you, I invite you you to take a look and join us at IMG or International Marketing group. As a member of IMG, you’ll be able to attend for free all the trainings you need in the area of financial management. I assure you you’ll find it so simple and yet so powerful.
IMG also offers a workshop called Financial Foundation Educational Program which is a Global Campaign for Financial Literacy. With this Financial Foundation Education Program, you will learn how to:
- Make money work better for you
- Find and save more money
- Understand investments and build wealth
- Protect and preserve your money.
- You can become your own Money Manager.
I’m really excited for you to know all these and be able to apply it in your life. Because when you do, you’ll surely be in control of your future and become your own money manager.
Here’s rooting for you moving to a secured and strong financial future.