Manage Your Money
Money is an amazing word. It inspires people, scares people, influences, people, and is a moving force in the world. Having money is great! Not having money can cause sleepless nights and an extreme amount for stress. The key to having money is managing it. Money should be controlled not controlling.
Money comes and goes throughout our lives and many people do not have a clue what to do with it. Yes, we all know how to spend it and we know how to pay the bills but beyond that, few people know how to manage money. Want to know what the few people that know how to control their money are called? Rich! It all comes down to knowing where the money is going and how much there is coming in.
The majority of people in the world lives paycheck to paycheck and has no chance of getting ahead. Is this because they are poor? No, it is because they have no idea how to manage the money they have. To be a success at any income level, one has to spend less than they earn. If you can not afford something, don’t buy it! Instead of using the word Charge, use the word Cash. A debtor never gets rich and debtor will never succeed.
The first point of getting your finances under control is to realize that you are your own money manager. You can seek advice and you can get investment recommendations but it is your job to mange your money. There is nobody who has the same interest in your welfare as you do. There are loads of financial advisors, stock brokers, and credit fixers who are all lined up to control your money. There are some that are honest and are just trying to make a living by helping others. However, there are way more who are out to suck a percentage of your money and some are out right scams. Know who you are dealing with and listen to what they have to say and sign nothing you do not understand. Money education is the key for you to manage your money.
To start managing your money, you first need to know what you have coming in. This includes all income no matter how small or how big. The next thing you need to know is your fixed monthly expenses. This should start with the basic needs; food, shelter, utilities, and transportation. Once you have the basics covered, you need to figure out where you are at for the rest of your expenses. If you have more expenses than you have income, something has to give. This can be in the form of cutting expenses or increasing income, preferably both. You can not spend more than you make!
If your expenses are less than your income side, you are in a position to really take control of your money. Do you have credit card, student loans, car loans, or any other form of debt? Typical answer is yes, doesn’t everyone? Believe it or not, the answer is, many people do live debt free. Want to know what those people are called? Rich! However, if you do carry debt, the key is to pay it off as quickly as possible. First you want to save enough to cover a small emergency such as a major car repair or medical expense. You should save around a $1000-$1500 as quickly as possible. This money should be liquid and ready to spend if needed. After that, you attack the debt from smallest balance to highest balance with all that you can throw at it.
Prepare a budget and on paper you need to spend all your income every month either by paying expenses or putting all above that on debt repayment. You will soon be shocked to see how much money goes through your hands each month that you have no accountability for. Live below your means and you will be able to rid your family of debt faster than you ever thought possible. At that point, you will be able to finance your life dreams without borrowing for the rest of your life.
Money management is not something to outsource. You and your spouse (if you have one) should work out a budget together and stick to it. Allow for some fun but live as far below your means as possible to get out of debt. Putting everything on paper and holding everyone who is part of the core family accountable will allow you to control your money and not allow it to control you.
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