Money Management
Do you ever wonder where all your money goes at the end of the month? You’re looking at your bank account perplexed not having a single clue of what happened. Then you go through your account history to see how much you’ve spent during the month. And that’s the moment when you realize something has to be done in managing your money daily, weekly and monthly. Many people go through this every single day and have no idea what to do. Money management is the key to having control by keeping track of one’s daily and monthly spending throughout the year. There are many ways a person can manage their money such as by budgeting, saving, and using credit cards wisely.
Budgeting
What exactly is budgeting? A budget is a plan that helps
It’s not easy starting, and actually following a budgeting plan but there are eight steps that will help you get started. Following these steps will help you in setting up your very own, personalized budget: “Step 1. Make a list of your values, Step 2. Set your goals, Step 3. Determine your income, Step 4. Determine your expenses, Step 5. Create your budget, Step 6. Pay yourself first!, Step 7. Be careful with credit cards, and lastly Step 8. Check back periodically” (1). It’s important to list all the values
Don’t think about your goals mentally, instead write them down on a piece of paper (visuals are better). Also take note of where do you see yourself in three months, one year, and three years from now financially. Figure out what your available income is each month such as the amount you take-home; don’t include any overtime pay. Determine all your expenses which are fixed expenses, variable expenses, taxes/insurance, credit card statements, and any receipts that show where your money is actually going. There’s many apps you can use to manage your money like You Need A Budget, Mint, Level Money, and Digit.Co just to name a few (2). Digit.Co is a free app that links your “Digit savings account to your checking account, and every few days, it transfers a small amount of money from checking to savings” (2). This app “learns” ones spending habits and helps you from overdrawing your account. Just in case because you never know when that day can come; it’s better to be safe than sorry. Level Money is also another great free app that helps you keep track of weekly, monthly, and daily spending. Every app will have its perks and cons
Budgeting is a familiar term to most American families. Dictionary.com defines budgeting as an estimate, often itemized, of expected income and expense for a given period in the future. In order to avoid debt, bankruptcy, or overspending it is common to create a spreadsheet of some sort tracking your spending and income. On a grander scheme, the Unites States has to budget as well.
• Not budgeting is one of the most overlooked financial mistakes. You need to know exactly how much money comes in and out at least on the weekly basis. To explain, you must find out exactly how much money you bring home, separate the money in categories to cover those expenses and finally stick with the plan.
Budgets are the financial requirements and consequences of plans. Budgets are made with specific goals in mind. Budgets can be used to lower living expenses, increase savings, or to save for a purpose such as: education or retirement. Budgeting is a process that involves these actions: defining goals, gathering information, forming expectations, reconciling goals and data, monitoring goals and variances, adjusting budgets, and redefining goals.
Budgeting is the track of money you receive, but allowing yourself to spend a certain amount without going in debt. Referring back to the statement I mentioned in the previous paragraph, this prepares us for the future. The effect this budgeting projecting has on me, is it taught me a life lesson. The lesson this taught me was that I can’t go all out spending a lot of money. I thoroughly understand this by me ending up on debt on my project. This had caused me to go back and modify my spending. I had to modify most of my wants to needs. Another topic we have learned dealing with the human needs are Maslow’s Hierarchy of Needs.
To get a handle on those extras, you'll want to put together a monthly budget that estimates your costs. Be sure to include:
There may have some short term goal and long term goals depending on the time frame we set out. Setting a financial goal should be serious and a realistic goals because we could fall out with every goals if we have no outstanding set of goal. For example; I want to become a network security but I have no financial support or set of goal, I would not make my dream to come true. The finance follows everything that we do in order to success. Without a financial goal, it is like climbing on a tree without ladder. During my short term goal, I decided to save money as much as I could to support for myself. I also could get help from my families but I do not want to rely on them. I only accept their support for activities such as taking vacations. I decided to save money for my college and retirement plan by myself since I could able to work on full-time or part-time jobs. Financial goal also require prioritizing times and managing skills. As for myself, I need to know where the money come from and where it going in order to track my financial goal. I have to decide which is important or urgent, do I want or needed. I would not care if something that I do not seriously need for anything that doesn’t relate to my goal. I always have to figure out an accurate amount of money I spend and talk to my family if I need help. I could also go and talk to the Donnelly Financial Aid Advisor to let me know how my financial aid will reflect on the classes that I would take. I also set my retirement plan as a long-term goal, so I am going to start before reaching my short term goal by little as little. I believe I would be able to save money for retirement of the next fifty years if I save day to day or month to month
Figuring out where you will be financially years from now is hard to imagine. There are always what you plan, and then there’s things that just happen that you would usually rather not have of. You can always make goals and things and hope that things go alright and end up close to what you expected.
Today is the day to start saving money for retirement. The way people can be more informed with where there money goes, and how it is spent is by merging unnecessary accounts together. This gives a better view of how much is at hand, and the account information is very helpful in knowing how it is used. This method is informative and simply, and can help save a lot. Also, people can pay them selves first. By doing this money is put into a specific account before anything else. This way there is less to spend or waste, and its almost like it was never there to begin with so it is not missed. Along with those options people should sacrifice unneeded luxuries to save money, especially during the warmer months. One article says, “Summertime is notorious for...
Goals may vary depending on the stage of one’s life. A common goal for individuals who are seeking to budget is working towards a debt free future. Steps would include, an
In conclusion, the best way to manage your money is to keep a budget and record all your transaction to see where your money is going. Living with a budget isn’t the easiest thing in the world, but it can be a great alternative to worrying about how you are going to pay for your expenses. Budgeting allows you to create a spending plan for your money; it ensures that you will always have money for the things that are important to you. Following a budget will also keep you out of debt. If you don’t balance your budget and spend more than you make, you will have financial problems. Many people don’t realize that they spend more than they earn and slowly sink deeper into debt every year.
Once you set your goal, you need to start getting more specific. It moves from a dream into reality. Make a plan, it must move from your mind to a piece of paper. Write down the things that you need to do. What do you want to achieve? What will be your life when you achieve your goal? Things that you need to be done. Things that you want to learn more about your goal. Qualities that you admire in others. Improves the qualities you have. Habits that you want to stop and habits that you want to improve.
Money is essential for our everyday lives and people have to face choosing whether to save up or spend their money. Of course earning our money can difficult considering that it is a necessary asset that affects every aspect of our life. Every day we see people working hard to earn as much money as the can. However how they use using the all the money earned is a frequently debated topic have seen many people who earn money and can no restrict themselves from spending .They usually act like wild animals fighting for food and being separating from the delusions of business. People are usually confused and frustrated by the amount money the use in a week without knowing that their daily impulse buying objects have piled up. Although it can be very hard to control there are many easy steps to stay away y from spending and instead saying up. Setting a goal, recording the amount you spend and even lowering your expenses can be small steps that will lead to great success in saving for the future
In setting a goal, you set up a grand goal and then you break it down into smaller goals. This helps you to further monitor your progress on a smaller scale and helps you stay motivated and focused because each time you achieve one of the smaller goals, it keeps you inspired to achieve the grand goal. Set goals that are definite with a well-known target to achieve, always giving yourself a specific time-stamped to achieve your goals. However, ensure that your goals and time lines set are realistic otherwise you will end frustrated chasing castles in the
The public can every now and again use some of the money set aside to purchase luxury items, or enjoy a family vacation. Depending on one’s income experts the amount they are able to indulge in “fun spending.” Budgeting is key when saving to spend on this type of occasion because going overboard can push you to start the whole saving process all over again. Saving is important for all aspects, and it also helps one to enjoy the quality of life when spending for fun.