Self Help Guide to Personal Finance

• 15 September 2016 | 1895 Views | By Mint2Save

Irrespective of what job you do, how you work, where you work; a good bank statement is always needed. Doesn’t matter how good you are at your job, if you cannot manage a good personal finance portfolio, there would hardly be any chance of being at peace.

Just as a growing tree needs a better utilization of sunlight, young and employed need a regular finance management.

The catch here is, money is too personal and sharing facts about it with anyone requires trust, reliability and secrecy and such people are very rare to find.

As they say, Self Help is the best help! For managing your personal finances, the best advisor is none other than you?

This little piece shares some well tested practices and habits that would make you an expert financial advisor.

Create an Expense Tracker

Most vital step to help set your budget for anything is to track your present expenses. Maintain an income-expense journal and update all the expenses you made and income you earned. The best time to update this journal is right after you finish your daily chores and are about to go to bed. If not interested in keeping a paper and pen based journal, you can always choose from the variety of smartphone apps or MS Excel workbooks.

Regular expense tracking would eventually reveal your spending pattern. Using that, you can not only alter the budget for various products or services, but would lead to a different perspective while seeking alternatives to one product.

Your expenses would never go over your head and the question of how much I have saved, would always have a satisfactory answer.

You can check out these must try expense trackers for Android.

Cut Savings before Expenses

The payday is the best for most of us. We make merry, attend a get together and shop. Before you start juggling with the paycheck, cut the savings off it. Deposit all the money you intend to save into a different account. From that savings account, you can allocate your funds to whatever investment you find worthy. Post this task, feel free to spend your money.

First approach to savings is crucial, as your huge purchases, emergency funds, long trips, all depend on how much have you saved. Being consistent in saving would create a huge fund corpus. Savings do not have to take a large chunk of your income, and is ideally recommended use 1/3^rd to 1/4^th of the net salary as savings.

Mandatory Investment

Most of us reading this article would be far more concerned for the latest mobile in the market, but not for the best investment instrument available. The latter is far more important and critical than the silicon based hardware. Just keeping your money in the savings account is not enough. You must take investments as mandatory and actively participate in new investment avenues (research, explore, invest).

Goal Oriented Investing

Before strolling into any investment, you must calculate its risk and return time frame. For all the investments are based on certain goals (buying a car, a house, new business, etc.), it would be baseless not to categorize them.

Visit our article on Goal Oriented Investing for better understanding on the topic.

Categorize them on the basis of time, goals or risk, make you don’t have plenty in the same category.

These personal finance tips for your peace of mind are not focused upon the technical part of finance and how rates and returns are to be analyzed. But they intend to create a habit of saving, judging investments, and creating goals.