Knowing how to separate necessary expenses from superfluous ones is essential to have good finances and enjoy a healthy economy that allows us to live without stress
Having good finances can help you, for example, to invest in the future, to have money available in an emergency, to expand your business or to avoid economic problems in times of crisis.
In this article we will give you some tips so you can better manage your earnings.
Tips for having good finances
No matter how much you earn… you can be in debt or “living paycheck to paycheck” even though you have a lot of money. To have good finances, the basis lies in knowing how to manage what we receive (whatever amount it is).
These tips can help you to make your personal economy healthy:
1. Learn
When you have free time on the weekend or on the way to work on the subway, read a book or publication that teaches you how to better manage money.
You will be able to get a good amount of interesting ideas to put into practice. You can also ask people who are in a good situation (not for what they earn, but for how they organize themselves with money). Do not ignore the possibility of having a financial "coach" if necessary.
2. Prioritize
One of the main causes of economic problems in couples or families is that they do not identify which are the main expenses and which are unnecessary. Believe it or not, the latter are the ones that take a good part of the income, especially if they are not monitored.
- When you receive your salary, the first thing you should do is separate what you need to feed yourself and pay the bills.
- The rest you can use to save or invest.
- With this very clear, you can even “treat yourself” each month.
3. Set goals
We would all like to be millionaires, but you need to be a little more precise in your goals. For example, if you want to have good finances to start your own business, buy a house or pay for your children's college, you must act accordingly.
Once you have a defined goal, it will be easier for you to organize yourself and avoid unnecessary expenses.
4. Make a budget
When you have clear goals and know what your priorities are, the next step is to set a budget. This should be the main thing in a home because it allows you to monitor expenses and income and think about the future. It's as simple as putting together a file on your computer or writing in a notebook. Whatever is simpler and you can take advantage of it.
The first time it may be a bit boring or tedious, but after that you will do it in less time. In addition, you will realize its advantages and you will not want to change methods. Of course: take the trouble to record everything you spend so that there are no problems in the accounts.
5. Look for prices
Another technique to have good finances is to compare prices and services. This not only has to do with work, but also with everyday expenses.
If you always go to the same market, you can try to find others that are more affordable. Look for prices on everything you want to buy, from a product to a service.
- Compare the quality and durability of the items, since many times it is not only choosing the cheapest, but also the one that will serve you the longest.
- Make wholesale purchases, take advantage of offers, get promotions. That way you won't overspend.
6. Establish a base savings
One of the keys to being able to save is not to separate a part of the money once everything else has been paid, but the other way around.
First determine how much you will save and then use the rest for your expenses. Of course, this doesn't mean starving or owing rent, but it does prevent you from using that amount for unimportant things.
- To get started, save 10% of your income at the time you get paid.
- You can deposit it in a savings account to earn interest.
- Don't leave them at home, even in a safe deposit box, because the temptation can be quite strong.
7. Do not go into debt
Credit cards are a double-edged sword because, on the one hand, they "save" you, but on the other, they "sink" you, financially speaking. We do not realize that we are spending more than necessary if we pass a plastic through a machine.
However, later, when it's time to pay, we don't know where to get the money. And we resort to the famous "minimum payment" that the only thing that causes is more debts (because, of course, it has higher interests).
Therefore, before swiping your card in a store, think carefully about whether it is worth the expense. Otherwise, wait until you have the cash to buy it. Only use this payment method when there is no other option or if the benefit is really interesting.
8. Invest
"Savings is the basis of fortune" indicates a popular saying. But to that we must add something else: investment. It is the next stay to have good finances.
Remember that it is not good to bet everything you have on the same project. Diversification can be very useful so as not to lose everything.
Consultation on different types of investments (short, medium and long term) and in various sectors (bonds, real estate, stocks, etc.). It would not hurt to work with a financial advisor to explain what the best options are according to your possibilities.
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