Most people picture scary-looking algorithms, complex contracts, confusing percentages and so forth at the mere mention of the word finance, personal or otherwise. For this reason, a lot of people don’t want to learn about it just because it is too hard. Yet some others have the notion that if you keep earning more you definitely will have more to spare. Well, if you are not worried enough about your wealth, then soon you will have not enough wealth to be greatly worried about.
At the beginning of your career you are not worried a lot about savings and other such things because you live mostly in the present. But as you grow older and have greater things to be worried about, you start thinking of the future which prompts you to think of investments, savings, and retirement. So, instead of worrying about where to pay the next bill from when you can’t work as much, save when you can work for it.
Contrary to popular perception finance doesn’t have to be hard and complicated. They are as simple and plain as working on your inputs and planning your outputs.
Keep It Simple
Simplify your finances right down to all your expenses so you have clear picture in your head of what’s coming and what’s going. Have these processes on your fingertips and you will soon master them easily. Although not everything can be assessed based on coming in versus going out it is what forms the basic, and needs to be mastered well.
Analyze And Calculate
Know the vital information like incomes and expenses well. That is the basic input you will need in order to plan. Keep a margin for clothing, repair works and the likes for each quarter or half year as required. These figures are important to take in consideration. Once you have worked out all the in’s and the out’s you can easily figure what you will be left with each month to build up on anything constructive.
With the above in view, here are 7 steps to make finance a no-brainer.
- Reduce The Number Of Credit Cards: Cut down the number of credit cards to a maximum of two. Use them as scarcely as possible and if you have any unpaid balance on the discarded credit cards ensure their settlement is included in the monthly outputs column.
- Automating: Automate direct savings from paychecks to saving funds, payment of household bills, and credit debts so that you don’t end up paying excess in penalties. Although, make sure you account is equipped enough for these deductions from the paycheck.
- Regular Saving: Ensure to list in your output column an amount towards savings. A great way to make sure that happens every month is to get a proposed amount transferred directly to the account from your paycheck.
- Use One Finance Institution: Diversifying in this regard may not be the best choice as it may lead to complications. Instead choose a bank which will cover a greater portion of your needs, and it also makes you a bigger customer.
- Mutual Funds: Invest in mutual funds to initiate your retirement plans. By the time you retire you will have enough.
- Link Accounts: Link your checking and savings account to check overdrafting.
- Multiple Accounts: If you are not sure you can stay away from the bill to pay, open a second checking account exclusively for that purpose.
Follow these steps to make your finance simple and easy.