Guidelines to Organize your Finance
Finance is actually as old as human life on earth. This word has originally been a French word adapted in the 18th Century from English speaking communities to mean the “management of money”. Since then, it has been used by everyone in the world and got it permanent position in the English dictionary and has become the most important part of everyone’s day to day lives. Finance can be described as an exchange or management of money. A barter trading system is also known to be a type of finance. Thus, it can be a true saying that finance is an art of managing several resources such as money, investments, assets, securities etc. These days it can be impossible to imagine the world without finance. It works as a soul of our economic activities. It’s never too late to have a control of your personal finances. Cost of education, food, clothes and almost all other things are escalating at high rates. Therefore, a proper financial planning is required to perform to live a happy and peaceful life.
Following are the guidelines that can tell you how to organize your finance:-
Curb your expenses
Income is limited, whereas your expenses are unlimited. Therefore, to start savings you should first cut your expenses. Cutting down on phone data usage, lowering dining out and entertainment, taking public transport, unsubscribing magazines and similar such steps would help in diminishing your expenditure and save some good amount of funds.
Lower down the use the number of credit cards
It is advisable to use either one or two credit cards and must pay the amount right on time and always pay more than the required minimum amount. Two cards are always better than the one to establish a good management of money and a better credit score.
Set up a monthly budget plan
For organizing your finance, you should set up a monthly budget plan. Setting up savings goals will always be motivating and you can certainly achieve all your financial goals with ease. Right after receiving your monthly paycheck, you should make a separate category for day to day expenses, credit card bills, utility bills etc. Plus, you should also focus on making a room for savings as well. Developing a savings habit will help you to achieve financial security with ease.
Make a list of your priorities
List down what you want to attain. Your goals may include paying off credit card bills, generate savings for emergency expenses, save for retirement, save for buying a car and more. Work on your goals step by step and deposit some amount of funds for these desires every month from your hard earned income. Stop spending money on things which you can easily avoid or can live without. Setting up your priorities straight will help you in organize your finance wisely and leading a great life.
Go for automate your savings option
Most people are still following the old method of saving money that is first they spend on expenses and then save whatever is left over. But the fact is this method is not working anymore, due to higher amount of expenses and limited income in hands. Therefore, this generates the need of setting up automatic saving option. Just like you do with your bills, you can apply this method for savings as well. Decide up a fix amount and the day your monthly income gets credited, that decided amount will be automatically saved and then you can spend the rest of the amount for expenses. If the money is still left, then it will act as your added savings which is just amazing. So, this is how your savings will start to increase.
Use financial software
You can find such software free online. They are not available just for investments, but can also help in teaching you to organize your finance. You can scale-down your income, expenses and spending on the software and can keep a track of it. Within the software program, you can get detailed information as to where your money is actually going every month. You can even calculate the cost of your expenses on monthly basis and can figure out where you need to curb your expenses and can take knowledge about areas of your savings.
Try to have two bank accounts
Use one bank account for savings and use another one to pay bills. This way you can prevent yourself from accidently spending more on extra expenditure like dining out, entertainment and more.
Pay bills as soon as your receive them
By indulging in a habit of paying off bills even before the due date comes, you will be able to stay away from overdraft or late fee charges. Unexpected expenses can pop up at any time. So, if you don’t want your planned expenses to get ignored due to unexpected ones, then you should pay them the same day you receive them.