Where does your money go?
If you do not keep track of your expenses, you won’t whether you are spending your money wisely. When you know where your money goes, you feel more in control. Take time to think about your spending. After assessing how you manage your money, you might want to change your spending and saving habits. Being able to better manage your money will help you prepare for the future.
Eight Steps to Better Money Management
As you work toward managing your money more effectively, keep these steps in mind.
1. Plan ahead.
Write down your goals and objectives. It's important to be realistic. Right now when you are in school, will you more likely be able to afford a $10,000 car or one that costs $30,000? Review your goals and objectives regularly to see if you are on track.
2. Create a budget.
Create a plan on how you will spend and save money. Update it regularly and evaluate your goals. Think about your financial situation, where you need to be, and determine how you're going to get there.
3. Keep good records.
It's difficult to get your finances under control if you don't understand the basics of good record keeping. Keeping track of your bills, checks and other financial transactions is important. Keep a file box to put all of your records in.
4. Stay insured.
Purchase health insurance to avoid being hard hit by a financial loss due to accident or illness. It is an important part of your financial plan. Depending on your circumstances, look into renter’s insurance, car insurance, home owner’s insurance, or flood insurance.
5. Stay focused.
You'll need patience and discipline to start your financial plan and to follow it through. Don't be tempted to overspend.
6. Save more.
It's important to save money regularly so you can use it in the future. Begin by faithfully saving a small amount. If you are able to save enough money, you will be able to put some into investments, use it in emergencies or use it to reach your goals.
7. Educate yourself.
No one can protect you from your own bad judgment. Get the information you need to avoid financial trouble and make thoughtful decisions that can improve your financial security.
8. Take time.
Set aside time each month to work on your money management. Pick a time that works for you such as early in the morning when everyone else is asleep or a quiet time during the evening. You will find that it's time well spent.
Goal setting is an important part of success, whether you are aspiring to reach objectives
in school, career, or your personal life. Aim too high and you may get frustrated
and give up; aim too low and you might not push yourself to reach your full potential.
Think about your financial goals and how you plan to reach them.
• What do you want your financial picture to look like in one year?Five years? Ten years?
• Do you want to buy a car, buy a house, start a family, or pay off student loans?
• What do you need to change to reach your goals?
• Think about your financial goals and how you plan to reach them.