Conquer Personal Finance: Break Bad Habits & Embrace New Good Ones!
There is a lot of advice that seems to get passed around from person to person with regards to your finances. On occasions, this advice may be sound, but often it is vague and simply too generic to be of any real value. You don’t want to use advice that doesn’t get the job done, and you don’t want to follow the path of flawed advice either.
However the question remains: How could you manage your personal finances and in what way can you avoid wasting your money on worthless things?
One of the main problems encountered in successful financial management is that many people (perhaps you are one of them) don’t understand how important it is to put some money aside for later use. Typically, a consumer spends money when the paycheck arrives and tries to save a little bit for later on in the week. This might be better compared to a person ho does not save at all, but is not the right way to save.
Better Strategies For Saving Money
If you need help saving money, keep these pieces of advice in mind when managing your money. Whenever people have practiced these methods, they have been successful and got good results.
Save 20 Percent Of Your Earnings
While others may spend their entire paycheck and save the little bits of chump change left over, you’re going to do things the opposite way. No matter how much you make, reserve 20% of it, and put it into savings. To make it easier, you can keep it in a savings account or in a separate wallet. You should not be looking to spend this on a nice pair of shoes because you require this money down the road.
This allows you to budget your money effectively while saving something for the future. Won’t it ease your mind to know that you have some emergency money just in case you have an emergency?
Stick With The Basics
Temptation can be very strong when you see others with gadgets and other items you would like. All your friends and co-workers have it, however you purchased an iPhone 5s fairly recently. The hard truth is that while it may be tempting to get the latest and greatest consumer products on the market, it isn’t a good idea unless you truly need it. Do you really need it?
Can that new phone do something that your old model can’t do? It’s always nice to be able to give yourself a little reward with a luxurious new item, but do be sensible. Only buy things when you have excess money available, not including the one-fifth that you are saving.
Use Cash Instead Of Credit
Don’t fall for fancy credit card marketing. Lots of folks find themselves in major financial trouble by purchasing lots of little things on their cards. Who doesn’t like the idea of going out and getting that $50 dress? The problem is, it’s just too easy to slip. You make a few too many small purchases, and before you know it you’re carrying a staggering long-term balance.
Always pay cash whenever you can. Credit cards should only be used in emergencies, or when you have planned ahead. Replacing it with a debit card is even much better.
It is not so hard to manage your personal finances. All you have to do is cultivate better financial habits.