• PassCash - Your way to send money

How to Manage Your Money: 10 Tips to do it Right

  • 2022-12-01 11:50 PM
  • by PassCash
  • 1145

How to Manage Your Money: 10 Tips to do it Right

 

Money management is important for everyone. Having control over your spending really can influence every aspect of your life as most of your decisions depend on money. If you manage your money well, you will have an independent life. You can start saving for your future and you will not have to work for money, you will make it work for you.

Do you find money management complicated and difficult? Although it might seem hard to start at first, once you get used to the process, money management can be much easier. Try these simple tips to start improving your finances:

  1. Keep track of all your expenses.

Tracking your expenses is one of the key factors in making your budget work for you. If you do not know how much you have spent each month, you cannot tell when you have overspent. Even the small expenses can cause you to blow your budget. 

- If you spend more than what you have, now you need to cut back. For example, in order to reduce your spending, you should get used to preparing lunch from home, selling the stuff you do not need anymore.

- Do not throw away all your receipts, you can scan your receipts with Money Lover to keep track and manage your expenses easier.

- When you have a pay rise, do not rush to spend more. Think about saving more or checking if any of your household cost/living cost has increased.

 

  1. Set up budget

In order to be your own financial manager, what you need to take is to set up a budget. You need to note down all the money you receive and what you spend them on. You need to decide on how much you would spend for each category such as:

- Financial products

- Household bills

- Living costs

- Giving (donations, gifts for family and friends)

- Leisure (vacation, fancy dinner)

After having control over the money you spend, you will find out the area you can cut off for a saving. 



3. Cut costs

Focus on recurring monthly, quarterly or annual expenses. Can you cut back on utilities, rent or payroll? Are you spending money on subscriptions or services you’re not using or insurance you no longer need? Can you renegotiate the terms of outstanding loans or leases?

 

4. Manage all your debts

The debate about "good" and "bad" debt aside, debt is often considered “normal.” Regardless, it can (and should) be part of an overall money management strategy that helps you prepare for a debt free future. By planning ahead, informing yourself, actively using a household budget, only borrowing when it makes sense to borrow, and setting yourself up to successfully deal with bumps in the road you'll be in a great position to avoid money worries and stress. After all, and it's true of debt management as well, failing to plan is planning to fail. 

5. Build a saving plan

Saving is more important than spending. The more money you can hold, the more money you have. Even if your budget is small, try to save at least 10% of your salary.


- Have some emergency savings, save money for the unexpected circumstances. What if your car breaks down and you have to pay a thousand dollars bill?

- Set a saving goal: get 3 to 6 months expenses to an account in order to have a vacation, buy a car or even more for a house.

- Once your savings start to grow, you can consider putting more money into your pension or making an investment plan based on your own goals.

 

 

6. Make investment plan

Drawing on the information from your money fact find, your investment plan should set out:

  • your investment goals and what types of savings and investments might be suitable for achieving them, taking into account your time-frames, financial situation, tax position, risk appetite (what level of risk you are prepared to take with your money) and your propensity for loss (how much of your original capital are you prepared to lose to achieve a higher return on your investment)


  • what kind of returns you need and can reasonably expect (if you’re new to investing talking to a qualified financial advisor may be especially helpful)

 

 

 

 

 

7. Get paid faster by using mobile payment solutions

If you sell products or provide services at customers’ homes or offices, get paid on the spot with mobile apps that use your smartphone or tablet to accept payment by credit and debit card.

8. Speed payments by offering deals.

Consider offering your customers incentives, such as a percentage off the total, for early payments. Do the math beforehand to ensure the tradeoff (getting paid early) is worth the loss (less money in the long run).


9. Shop around for big purchases

When shopping for a big purchase make sure to shop around. Although it will take an investment of time, you could stand to save thousands.

For example, when shopping for a car you’ll need to look at multiple cars and compare quotes. Don’t just accept the first quote. Make sure that you are getting a good deal.


10. Find your reason

Staying on top of your finances will require some amount of time and effort. At some point, you’ll probably feel like giving up. It is a completely natural feeling.

The best way to avoid personal finance burnout is to find your reason. Why are you choosing to learn how to manage your money? Why are you taking action to put yourself in a better financial position?

A few common reasons include getting rid of oppressive debt, becoming financially independent, and spending more time on the things that light you up.

Whatever your reason, make sure you have one. Take a minute to understand your why. Go beyond simply wanting more money to understanding why you want more money.