6 Proven Personal Finance Tips

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You had been looking for personal finance tips and trying to move our finances to the next level? Wait no more!

These days, everyone wants their money safe and secure. But unfortunately, the financial world is becoming more unstable and our numerous needs are changing at a rapid pace. The need for individuals and families to save and manage their money is paramount.

Proven Personal Finance Tips To Move Your Finances To The Next Level

The immense subject on everyone’s mind now is managing a budget, saving and investing their money wisely. However, it has become extremely hard saving money today. But if not for anything, you should make an effort to save for retirement, your kids’ college education, or for a sense of comfort in case you get laid off.

Have you taken a look at your finances recently? The process of creating wealth and achieving all of your financial goals begins with the awareness of what personal finance entails. Personal finance has less to do with cashing your payroll check, settling your bills and meeting all of your monthly obligations and more to do with saving enough money in order to meet your financial objectives in life. 

Now is the right time to start reviewing your finances and to come up with a good financial program with goals that fit your financial expectations.

Take immediate action and make some positive adjustments, after you review your finances. Don`t try to take care of it by yourself. Ensure all of your family members are aware of your plans and can assist you in meeting all of your financial goals.

It is also important you measure your results and make all possible changes required. When you and your family achieve the goals, motivate yourselves with some kind of rewards. They propel greater achievements. Review the following tips to help you take charge of your finances.

Read on 6 Tips to Help Manage Investment Risk

6 Proven Personal Finance Tips

1. It matters a lot less on how much you make

One of the most important maxims of personal finance is this: It is not how much you make but how much you keep. You should save at least 15% or more of your net earnings from every paycheck, or you automate your savings. Decide how much you want to add every month or paycheck and schedule a deposit to move the money every time, to ensure you don`t forget to pay yourself first.

Also, you can enhance your savings by using roundup apps such as Digit and Qapital. They often roundup every purchase you make and deposit the change to your savings account, making it convenient to sock away a little more cash. The important thing is not to spend all your earnings. It is also important that you never live beyond your means (in essence, don’t spend more than you earn.

2. Take control of your spending

Take control of your spending in order to maintain a good savings account. Have a good spending plan; it will let you know where you are spending. For example, if you own a home, there might be some major costs to incur, which you need to plan for, like house repairs or house renovation which can cost thousands or more.

Also if your appliances like your refrigerator fail, and you need to replace your vehicle and home computers; (which can be as expensive as a major refrigerator and are deemed necessities in many households), getting another one usually can`t wait and can easily set you back thousands or more. This is why having a good spending plan is crucial. 

Big things you can`t live without or face regular maintenance costs, make sure you plan for them. How do you do this? Break down the expense by how many months you usually have before it hits (you can look up average life spans for most things online) and set the money aside to make sure it`s there when you need it.

Consciously decide in advance on what you want to spend your money on and keep track of all of your money transactions for every month. 

3. Avoid impulse spending

Avoid impulse purchases. Nothing destroys a budget fast like impulse purchases. If you notice something you want that isn`t on your list, wait for a while before you buy. This will give you the opportunity to assess whether you are being enticed, or if it`s something you actually need.

Monitor your cash flow every day to determine whether or not you should increase your purchases. For bigger purchases, you may want to instil a one to four weeks waiting period, just to be safe. 

4. Make sure your bank meets your needs

Make sure your Bank is meeting your needs. If your Bank is not meeting your needs, you might need to look for another bank that offers a much higher savings and or investment program. Remember, your goal is to increase your income profile and therefore you should target banks that offer much higher savings and investment programs.

5. Invest and diversify

Invest money. One of the best investments you can make in your active years is to acquire a home. Home property appreciates in value on a daily basis, and that means more money for you whenever you want to sell it off. There are a number of good mortgage plans to get you started. Find the one that suits you the most. 

Determine the percentage of your income that you are willing to invest monthly. This is one of the most effective strategies for wealth creation. How do you determine the percentage of your income to save? It depends on your specific, long term reasons for saving; whether you are saving for retirement, emergency or for everything else.

6. Save for an emergency fund and retirement

Consider saving 10 – 15% of your income for retirement. This doesn`t take into account the contribution your employer makes.

Saving for emergencies. Establish an “emergency fund” that can cover 3-9 months of your living expenses.

How do you save such a large sum? First, you calculate your monthly cost-of-living. Assume that if you are laid off, you’ll sacrifice luxuries like your cable TV package or pedicures. How much then will you need to survive?

You then divide that number in half. Ask yourself, can I save this monthly? If yes, you’ll be able to build a six-month emergency fund within a year.

If you are saving for everything else, draw a list of major expenses within the next decade, write down your ideal savings target and dateline, then divide  by the number of months, you`ll then know how much to save per month

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