Tips on How to Successfully Handle Your Money
Saving money is challenging especially for young people who are just starting to earn money from their first job.It is understandable because it is exciting to know that you are earning your own money now. You are excited to buy new gadgets, clothes, shoes, bags and other things.You feel like you deserve to pamper yourself for working hard. Yes, you deserve the pampering and all but to a certain extent only.
After few months of working, you should start to become more responsible with your finances and start to think about your future. It may not be easy but you have to make a conscious effort or else you might find yourself broke in the near future. Do not worry because in this article, we will share to you some tips on how you can successfully handle your money.
Tip #1: Come up with a monthly budget plan – it is easy to be lured into spending for things that you do not even need when you have money. To avoid this, it is best to have a monthly budget plan. List down all your expenses – make sure to include all the important ones like rent, gas, phone bills among others. Assess your spending and then remove those that you do not need like magazines subscriptions, apps you are not using, memberships that you do not need among others. That way, you will be able to monitor your money. And make sure to follow your budget plan religiously. You should also take note how much you are earning including income from your day job and other sources of income. It will allow you to know how much budget is acceptable to spend. Knowing the amount that you are earning every month will inspire you to work harder to achieve more – increase your income to eventually increase your budget and savings too. If you find that you’re earning to be a bit lacking, then you can start to think about other ways to improve the monthly flow of cash.
Tip #2: Find additional source of income – Aside from your day job in the office that gives you monthly salary, it is better if you have a backup plan that will secure your finances even more.
It is advisable that you have multiple income streams. This is so you have more money for spending on shopping sprees, leisure trips, and emergencies.
You can start a small business that will give you additional income or you may consider venturing into other forms of investments like bond fund, mutual fund, and balanced fund. These are perfect for conservative investors who wish to earn additional income from their investment but wish to manage and secure the risk associated with the stock market.
Tip #3: Open a separate savings account –you have your payroll account, but it is still best to have a separate savings account. It is advisable to open an account without ATM card to avoid the temptation of withdrawing money every time you go out.Once you have your savings account, make sure to allot specific percentage out of your monthly salary to this account.
Tip #4: Avoid using credit cards –it is advisable to stay away from credit cards. These credit cards or often called as magic cards tempt you to spend beyond your means until you realize that you are drowning in debts already. So spend cash instead of using credit cards.
These tips will help you achieve financial stability while you are still young and have lots of opportunities. You should not fall to the trap of satisfying all your wants and luxuries in the present time to the point that you fail to allot money for your future. Be responsible with your finances as early as possible.
Author Bio: This post is contributed by Philam Asset Management Inc., the leading asset management and investment solutions provider in the Philippines. PAMI offers a complete range of insurance solutions to help you achieve your financial goals for key moments in life.