Organizing & developing a good financial plan is essential. Budget management can help you save long term and keeps your spending under control. This aim of this article is to help you plan your budget and become conscious of your financial situation.
The first tip I can give you is to divide your monthly income according the following plan. Take 60% of your income after tax to your basic expenses such as, household, cars, bills etc. The rest will be divided into three other categories. 10% of your income after taxes goes to education. If you want to develop your skills or learn new ones you will need a budget to join a course. This is what this 10% will cover.
The next category is your savings. 20% of your income will be transferred to your savings account. This money can only be touched if you invest it.
The final category is the fun budget. Take 10% of your salary and spend it on yourself or your family. Have some fun. This is your reward for being so disciplined throughout the month. One thing to know about this fund. It has to be spent in that month. It can’t be transferred to next month!
It is very common for people to want to have the newest design of their electrical devices. When you are tempted to buy the newest phone or TV, resist your temptation. Ask yourself the question: “Do I really need that new gadget? What would be a better investment of that cash?”
Another money saving tip is regarding your car. Before you go to a car dealer and purchase the newest model of your favorite brand, stop for a second and remember that the moment you take that car on the road it loses 20% from its original value. A better option would be to buy a used car cheaper and fix it up. It would save you a lot!
Becoming greener in your life can save you tons of money! It not only protects the environment but also spares you hundreds of dollars every month that accumulates to thousands in a year. Turn off electrical devices completely when unused. Don’t leave them on standby. That will save you energy that will in turn save you money. You would also feel good about yourself for helping protect the environment.
To sum up, in order to save money you have to learn to manage your finances well. An organized mind goes a long way. Monitor your expenses, be ready to live a bit simpler life for a few years. That will save you enough to invest and that will eventually lead you to accumulate wealth.