Reading Time: 3 minutes 5 Ways You Can Manage Your Money Better
This is a contributed post from Ellie Jo.
Managing money can be complicated. Every day we all do something with money. We either make money, spend money, save money, or investment money. Yet it’s a real struggle for so many of us to really understand our money. This article will give you some ideas to consider.
Write things down
Before you get started, you need to know what’s coming in, and how much is going out. Sit down and write down each expense that you’ve had to cover and how much it came to, and then take down how much money you actually made that month.
The easiest way to do this is to look at all of your bank statements and credit card statements. Personally we take this information and add it to a spreadsheet. One column is out flows and another column is inflows.
We recommend that you break down each column into categories so we can see themes of where we spend. Examples of categories would be utilities, recurring subscriptions, restaurants, grocery stores, mortgage, clothing, and on and on. Luckily our credit card categorizes most of these. This will help you become aware of where your money goes.
Having this written in clear writing will give you something to work with and a foundation on which to base your future spending.
Develop a budget
Now you know how much money you have to spare outside of your expenses, you can work out how much of that you should be spending on other things. Things like shopping and personal purchases.
Remember that you should always put some money away to the side just in case you need something to fall back on, or later on will need to make a necessary large investment. A budget will help to make sure you don’t overspend each month.
Remember to treat yourself
When figuring out your budget, it’s important to remember that it’s still your money to do what you want. If you can afford it, you should try to treat yourself every now and then, and it will help you to feel a bit freer with your finances. You don’t want to feel like you’re living paycheck to paycheck, so splash out a little cash from time to time on something to keep you satisfied.
Shop around
If you usually visit the same stores each day for your shopping, you could be wasting a lot of money, now’s the time you should be looking around and checking the prices in each store. What costs a lot in one store, might be worth little in another.
Different brands charge different amounts, and there’s no real way to find out why that is until you’ve tried it for yourself.
Work on your credit
As you improve your financial situation it’s a good idea to work on your credit score. Pay off your debts, meet loan deadlines with the money you already have. Get all of that out of the way now while you can. You might need to rely on your credit score when it comes to buying a property.
Consider Investing
After you have a plan around your spending, be sure to budget for investing.
After (not before) you have financial stability then consider allocating some of your investments in speculative investments. These are investments that have a high probability of failure but a chance for a big payout They are high risk, high reward. For example, read Eric Pulier’s opinion on Metaverse. It might sound risky, but if you know what you’re doing, it could be worth your time.
In Conclusion
Managing money is a habit. It all starts with understanding where your money comes from and where it goes. After that do some fine tuning so you can find ways to keep more of it. The key is just understanding the moving parts.
ChaChingQueen is a lifestyle blog helping you live a happy and healthy life on a budget.