How to manage your finances is a key area to focus on for any household. Everybody is feelings the effects of the global economic recession, and time is harder than normal for most of us. Getting a handle on your financial situation is crucial if you want to make it through this period without losing assets or going into debt. There are a few things that can really hurt you financially, and there are some basic steps that you can take to avoid problems. Follow these simple tips to keep your financial future secure.
The first thing you should do when you think about how to manage your finances is to create an inventory. That means making a list of all your extra earnings, your assets, and your monthly income. Then you will need to list any expenses that you have. That includes rent, food, car payments, debt, and anything else that you need to set aside cash for on a regular basis. It is best if you keep these lists updated as often as possible. This will give you a solid view of your overall financial situation. You can see what areas you are spending a lot of money on, and where you can cut back expenses. It also gives you a chance to take stock of your wealth so that you can plan for the future.
If you are trying to figure out how to manage your finances, the next logical step after creating an inventory is to make some expenditure cuts. If you are on a tight budget, make some small changes and try to decrease spending wherever you can. This can be tough at first, but if you can start spending less now you will slowly build up your savings over time. Slowly increasing the amount that you cut back on expenses is a good way to save big over a reasonably short period. At the same time that you are cutting back expenses, you are saving for the future.So if you are fortunate to get a bonus or profit share that amounts to something reasonable, here are a few tips on tips on how to spend your income wisely.
Invest in real estate. As much as this sounds like really over flogged, it is a wise counsel. A businessman once said, “the only Estate that is Real is Real Estate”. Real estate is big business. There is a huge demand for rental apartments especially mini flats and 2 bedroom flats. There are several real estate companies offering instalments payment options for those interested in buying land. You can invest your windfall income in buying a half plot or full plot of land. I will advise you buy from a real estate company rather than directly from the community especially if you do not have funds for immediate development.
The simple reason is that the real estate company usually would have sorted out community settlement issues with the land owners and so you can be rest assured that you land is at least secure from land grabbers. Also, by buying from a real estate company, you will benefit from the quick capital appreciation of your investment and rapid development of the locations since there will be several people also buying and developing their property in that location. Another advantage of investing in real estate is that after developing the property, you can put it up for rent if you do not wish to reside in that location and use the rental income to pay your rent in your desired location.
Invest in a part-time business.If you already have a business that you can run part- time alongside your full-time job, you should invest your windfall income in that business. You can buy the needed equipment or register for a training programme that will increase your expertise in that business area. If you do not already have the business idea, you may want to consider doing some research to see what part-time business to invest in.
Invest in education. You can invest your windfall income in further education that will boost your profile and give you a better chance at a higher paying role in your industry or another industry entirely. You can also invest in the education of your loved ones like your spouse, children or siblings (if you have this responsibility thrust on you)
Invest in Marriage. Yes! you read me right.This is for those who believe in marriage. If you have a partner and your really desire to spend the rest of your life with the person, then invest your windfall income towards settling down. You can start making down payments for some critical items on you are list. Marriage is an investment in your lifetime happiness.
Invest in Charitable Activities. Don’t spend all your windfall income on yourself. Life is about sharing and putting smiles on the faces of others. You can give a portion of your windfall income to a charitable organisation. Depending on your religious leaning, Christians are advised to give a tithe of this to their local churches. However, if you are not a religious person, do well to give to a cause that will help humanity.