- Personal Finance
10 Ways To Monitor Your Personal Finances
"Save some for the rainy days" that's a popular quotation handed over for generations. Experience will teach us that there really is a need to save up so we can be ready for any financial problem that may arise. It is also important for parents to teach their kids on how to save money as soon as they recognize it's worth, like if they started asking you to buy something for them or asking for money to buy a toy or candy.
We need to start learning how to handle our personal finances and share whatever we've learned to your kids, husband / wife, friends, etc.
Fixed bills and Taxes - 1200
5% - 100
Daily Needs - 500
10 Ways to Monitor your Personal Finances
Here are some tips on how you can monitor your personal finances and how to handle them wisely:
First, you need to know where your income will be coming from and how much it will be. Will it be daily, weekly, bi-monthly, is it part-time, permanent, fixed, does it vary, etc. Those are some of the things you need to quantify as it will be the baseline of your personal finances. Know the details of your source of income before even thinking where to spend it. As a general rule - don't spend what you don't have.
Second, list your fixed bills, like rental, electricity, water, education, insurance premium, taxes, loans or mortgages, etc. Those expenses that has to be paid every month needs to be identified so you'll know how much your net take home pay is.
Third, save before you spend. After knowing what needs to be paid, try to take a percentage from the remainder of your income and allot it for savings. Even just a small part of your net income will do for starter. Open a bank account where you can deposit your savings. Remember, great things start from small beginnings. Don't wait for a large amount of money to enter your pocket before you decide to save. This will be your fund for the "rainy days".
Fourth, budget your daily expenses. Try to divide the remaining money you have after bills and savings to your daily expenses. List all the expenses that you may have like, allowances, food expense, and other basic things you and your family need to survive everyday living. It is very important to stick with your budget and don't go over it because you'll end up getting money from your savings or even filing for a loan. Quantify almost everything, even just the small things you buy daily.
Fifth, spend wisely. Do not buy things that you do not need. Remember the times when you end up having unimportant items in our cart while shopping? You have to refrain from doing this by creating a checklist of things you need to buy. Be a wise shopper. Compare prices but don't sacrifice quality.
Sixth, try to have weekend activities at home or at public parks, instead of going somewhere else, like malls, restaurants, theaters, or travelling outside your city to prevent spending too much. It would be fun to spend time with your family at your own backyard while having barbecue, or watching movies while sitting in your couch and eating popcorn. You can also play indoor games with your kids to add some fun into your weekends. If you really want to go out of town or in amusement parks and the likes, you need to plan it.
Seventh, plan your activities for the whole month. It's okay to go out for fun sometimes, but not most of the time as the money you spend for pleasure eats up your budget a lot. If you want to have a date, try to scout a place where it's going to be fun and budget-friendly at the same time. It's really important to pre-plan everything so you can work it out within your budget.
Eight, if you have loans or mortgages that will be paid up soon, don't include that money in your existing budget, but instead, add it to your savings. This will be a preparation to your next step which will be, putting up a business of your own. Remember, our lifestyle adjusts to the money we have on hand, so it's better to convert your allotted money for loans or mortgages to savings once they're paid off so when the time comes that you want to invest on something, you have your fund.
Ninth, take advantage of bundled services or promotions so you can save up on your expenses. One example would be your cellphone services. It would be best to get a bundled service or a family plan instead of getting individual plans for each phones that you and your family have. It's always good to check for offers from one company to another.
Tenth, make a list of all the expenses you've had everyday. You need to have a list where it shows all your expenses and how much you've spent for the day, if you can attach a receipt, then it would be better. This will prevent you from wondering where your money went. At least, you have an accounting of everything and you'll know where you've overspent. That will also be your basis when making your budget for the following month. You will also know what you need to prevent in the future.
I hope the tips above can help you manage your finances. This is not a professional advise rather it came from personal experience. Thanks for reading :)