3 Simple Ways to Manage your Finances

If there is one undertaking that any individual cannot escape, it is dealing with finances.

13:52 15 October 2013

Even as children we have been advised to use money wisely and to spend it economically.  Still, many individuals end up bankrupt or get in to deep financial trouble despite their desire not to. Let's look at a few simple ways by which you can manage your finances better.

Planning Your Expenses

Any endeavour should start with a plan, and it holds good with finances too.  You have to know how much money you have at your disposal and where each portion of it will go. However, a plan will only do you good if you abide by it.  Working hard on creating a budget but disregarding it when you come across a fancy item on sale or have a streak of impulse buying will just be an exercise in futility.

Saving

The piggy bank is one of the most famous icons you know from childhood.  Almost everyone is gifted with one to encourage saving even at a young age. Yet the symbolism is lost amidst the hundreds of things that you have to buy with whatever money you have – toy, food, trinkets, and - as we mature - gadgets, clothes, cars, jewelry.

The list goes on and on while saving is pushed back in the innermost recesses of our minds.  Setting aside a portion of your income can spell out a big difference in times of real emergencies, spending for major projects and even retirement.

Stay away from unwanted loans

Patience is a virtue, especially if you want to acquire something but do not have enough cash as of yet. If it is not a matter of life and death, it will be more advantageous if you can just save for whatever you want to buy rather than paying outrageous interest charges on installment schemes. Ultimately, interest charges have a way of silently encroaching into your resources and taking control of your finances without you realizing how deep you have sunk in debts.

Managing your finances may need more than just the desire to have our pennies in tip-top condition.  What we need is an iron resolve to spend time to understand the nuances of managing of our personal finances.