Money management tips

Money management tips

John Rockefeller said that spending money intelligently is much more difficult than earning it. Let’s follow the advice of the legendary billionaire and spend our money wisely by considering simple money management tips.

Make a List of Your Needs

The first thing you are to do is counting your main expenses for a certain period – a month, a quarter, a year. As a rule, those are regular payments for apartment, kids’ education, phone, internet, etc. Let’s also mention car service, housekeeping, food, clothing and entertainment. But if the first ones are not so hard to count, how can we measure our family’s expenses for food or entertainment? You should master a very useful money management skill: carrying out your own financial research. For instance, you want to know how much money you spend for clothes and shoes per month. Every time after visiting clothing store look through the check and write down the sum you’ve spent. Do it during several months and then find the arithmetic mean by dividing general sum for the number of months – that would be the approximate amount of money you usually spend. You may do the same for car service, entertainment, housekeeping, etc.

Reaching Long-Term Goals

Another point of money management basics is planning your expenses for future. So the second thing you are to do is defining your long-term goals. That could be summer tourism, buying a new car, changing your apartments’ design, etc. Then define a sum of money you are able to save every month without ignoring your current needs.

Another one of important tips on money management is taking into account some unexpected situations. Unfortunately, no one is guaranteed from extra expenses for car repair or medical services. By the way, if your month, quarter or year has passed without any force majeure, the saved costs can be added to your moneybox for reaching long-term goals.

All these money management tips can be followed using modern electronic devices. There are plenty of money managing programs with the graphic interface and comfortable navigation. You may use modern cloud services. First, they can be easily synchronised with your mobile, so you may use it wherever you are. Second, they will prevent you from loosing your data (as a rule, cloud services cherish their reputation and protect their data storage).

A Few More Money Management Advices:

  • Shopping should be planned. Market researches show that 75% of purchases people do are spontaneous. We simply see something attractive and buy it  without thinking is it what we really need. So one of basic money management skills is making a list of purchases you really need for today. Psychologists recommend: if you feel a big wish to buy something, just delay your visit to the shop for several days. It will give you time to analyze what you need right now and to make sure it would be really useful.
  • Make your savings “invisible”. Why do people use ceramic “piggy banks” from the Middle Ages till now? Because moneybox helps to avoid the temptation to spend the saved money. Our brain is automatically programmed to spend the whole amount of money that we see in front of our eyes. So if you want to save it you shouldn’t see it. What you can do is create a special bank account for your savings. As soon as you get the incomes, simply make the transaction and don’t use the “invisible” account for current needs.

We hope our tips for money management will help you to live a full life and to reach your goals.

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