Finance is an important aspect of every individual’s life. Although money can’t fetch you everything or bring you happiness, it can earn a sense of security. Making and managing one’s finances efficiently can be a herculean task and without a handle on money management, you may always feel like your life is one step away from a financial cliff.
The good thing however is that you don’t have to be an expert in personal finance or have a big investment portfolio to be financially secure. It is important to however understand and practice the basics of financial planning.
>Do You Want To Receive Update As Soon As We Publish? join our Telegram Channel stay updated with the latest headlines--CLICK HERE
Learning the basics of financial planning or finance management isn’t easy. For starters, there’s so much to think about like Budgeting, Debit, Credit, Savings, Spending, Interest Rates and so on; it never seems to stop.
5 Financial Advice you Need to Know in 2021
These few financial nuggets are designed to help you live your best financial life and take advantage of the fact that the younger you are, the more time your savings and investments have to grow.
1. Learn Self-Control
If you’re lucky, your parents taught you this skill when you were a kid. If not, keep in mind that the sooner you learn the fine art of delaying gratification, the sooner you’ll find it easy to keep your finances in order. Although you can effortlessly buy an item on credit the minute you want it, it’s better to wait until you’ve saved up the money for the purchase. Do you want to pay interest on a pair of jeans or a box of cereal? A debit card is handy and takes the money from your checking account, rather than racking up interest charges.
If you make a habit of putting all your purchases on credit cards despite not being able to pay your bill in full at the end of the month, you might still be paying for those items in 10 years. Credit cards are convenient and paying them off on time helps you build a good credit rating. And some offer appealing rewards. But–except in rare emergencies–make sure to always pay your balance in full when the bill arrives. Also, don’t carry more cards than you can keep track of. This financial tip is crucial for creating a healthy credit history.
2. Get Paid What You’re Worth and Spend Less Than You Earn
It may sound simple, but many people struggle with this first rule. Make sure you know what your job is worth in the marketplace, by evaluating your skills, productivity, job tasks, contribution to the company, and the going rate, both inside and outside the company, for what you do. Being underpaid even $1,000 a year can have a significant cumulative effect throughout your working life.
No matter how much or how little you’re paid, you’ll never get ahead if you spend more than you earn. Often it’s easier to spend less than it is to earn more, and a little cost-cutting effort in some areas can result in savings. And, it doesn’t always have to involve making big sacrifices.
3. Make a plan/Budgeting.
Having a financial plan is about more than figuring out how much of your paycheck is left after the bills are paid. Your plan starts with thinking about what you want to do. What goals do you have? Do you want to travel? Buy a house? Own a business?
Being successful, whatever that means to you, starts with having a clear idea of where you want to go and then making a plan to get there. Creating a budget is a key part of any financial plan and will help you achieve your goals and stay focused. If necessary, look for resources that provide budgeting or other money management tips.
The author John C. Maxwell explains budgeting perfectly, “A budget is telling your money where to go instead of wondering where it went.
4. Have a Savings Plan
You’ve heard it before: Pay yourself first. If you wait until you’ve met all of your other financial obligations before seeing what’s left over for saving, chances are, you’ll never have a healthy savings account or investments. Resolve to set aside a minimum of 5% of your salary for savings before you start paying your bills.
Better yet, have money automatically deducted from your paycheck and deposited into a separate account.
The French writer and pioneering aviator Antoine de Saint-Exupéry said, “A goal without a plan is just a wish.”
Turn your wishes into goals by creating a savings plan (and – you guessed it – sticking to it).
Work out what you’re saving for and how much you plan to save every month. Then, try to get into a rhythm of putting money aside each month.
Here’s the idea: Don’t spend your money and save what’s left – instead, save first and then spend what’s left.
Personal finance expert Dave Ramsey said it best: “Saving must become a priority, not just a thought. Pay yourself first.”
If you’re contributing to a retirement plan and a savings account and you can still manage to put some money into other investments, all the better. If you plan to build long-term wealth, then investing is a key piece of that. Investing over a long period of time can lead to amazing returns. You’ll be able to grow your money slowly as you invest more every year.
If you aren’t sure where to get started investing, then consider taking our free course. You’ll learn everything you need to know about investing your first dollar.
With these few tips, managing and growing your finances just got easier and achievable. You don’t need any fancy degrees or special background to become an expert at managing your finances.
Don’t allow your finances to get out of control before you start to manage them seriously. Small actions along the way can prevent a major financial disaster in the future.
Contents on this website should not be Copied,Republished, Reproduced and/or Redistributed either in whole or in part without proper/Adequate permission or acknowledgment. All contents are DMCA Protected. Defaulters will face the penalty immediately if discovered by reporting to Google!
If you own this content & believe your copyright was violated or infringed, please contact us at [firstname.lastname@example.org] to file a complaint and we will take necessary actions immediately.