Managing Your Money Wisely- You Can Do It!

To be a wise money manager you first need to know how much money you have that needs to be managed. That means knowing exactly how much money you are bringing in and if you have any additional sources of income other than your job then knowing that too!  

In order to learn to be the best money manager you can be, you need to learn the basic rules as they pertain to the important issue of money management. To get on the right path with your money here is what you need to do: 

Set goals for yourself

Financial goals are important and can act as a guide. Set short term goals as well as mid and long term goals.

Plan for your future

It is never too soon to start planning for your future. It is wise to plan all major purchases such as purchasing a car or a large ticket item (such as a piece of furniture or a new appliance) for your home.

Get insured

In the event that the unforeseen or the tragic happens to you, be prepared. Make sure you have enough life insurance, medical insurance and disability insurance. As well make sure you have enough property insurance. Do not burden your family members in ways that they should not be.

Know where your money is going

Do you know what happens to your money once you cash your paycheck? If your money seems to vanish into thin air then you need to start a record of what you spend on a daily basis. This will help you uncover areas of spending that can be reduced.

Design a budget

Create a monthly budget for yourself but make sure it is realistic and not too rigid. If it is too rigid then you will not follow it faithfully. Include in your budget your living expenses, the expenses that arise periodically, as well as how much debt you are paying on. Take the time to evaluate your budget from time to time to make sure that it continues to reflect a realistic financial picture.

Don’t go credit crazy!

Always use credit responsibly (always!). If you charge something on your credit card make sure that you pay it off at the end of the month. Do not pay only the minimum on your credit cards. Remember that interest is building all of the time! Did you know that your credit payments should never go beyond 20 percent of the income you are bringing in? Don’t let it happen to you! 

Pay your bills promptly

In order to have the best credit rating possible, be responsible when it comes to paying your bills. This includes everything from your mortgage or rent payments to your credit cards and your utility bills. Always pay your bills on time. If you find yourself in a financial bind then call up the creditor in question and ask if a suitable payment arrangement can be made.

Save for a rainy day (among other things)

Keep your future in your sights when you get paid. It is advisable to save roughly 10 percent of your gross income. If you want to do something big such as take a trip or make renovations to your home then save your money to make these things happen. Create an emergency fund for yourself that is equal to at least two to six month’s worth of income in the event that you lose your job. Preparation is half the battle!   

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