How you manage your money will have a huge impact on your life, and is one of the most necessary things to learn. Ways to manage money was not something they taught at school and we can’t be expected to just know it on our own! Take a look at our guide on how to manage money better and take hold of your finances.
Keep track of your finances
The first thing you need to do is keep track of how much you actually spend per month. This includes rent/mortgage, travel expenses, groceries, utility bills, leisure and anything else. When doing this, spend how you usually would just so you know exactly how much, and what your money goes on. You may be surprised about how much money you are wasting on unnecessary things.
Make a monthly budget
After keeping a note of your expenditure, you can plan for how much money you want to spend. You will be able to see where you can save money, and how much you can spend on other things, such as investments or savings.
Spend your money wisely
I’m not saying don’t spend your money on things that make you happy. What’s the point of working if we can’t spend money on things we actually want, right? Well, you can, but spend your money wisely. When you’re online shopping, make sure they have discount offers on, or instead of going to an expensive bar on a Saturday night, buy a bottle of wine from the grocery store and have a girls night in for half the price!
Be responsible with your credit card
It sounds strange to say, but having a credit card is actually a really good thing that everyone should have. Credit cards are a fantastic way of building up your credit score, especially if you are wanting to invest in a property and get a mortgage soon. The key thing with credit cards is to spend within your means. Only buy something if you have the money in your account now, and pay off the balance every month.
Save as much as possible
Savings are crucial for you to be able to manage money better. After having worked out your monthly expenses and creating a budget, you will have a better understanding of how much you can put aside into your savings. Even if it’s £100 per month, it’s still better than nothing. You will be on your way to putting a deposit down on a new home or sending a child to university.
Start an emergency fund
This one also comes under saving as much as possible. But is perhaps more necessary than just putting money into general savings. Make sure you have a minimum of three months earnings in your emergency fund so that you are prepared for anything that may come your way. No one wants to be financially set back due to a broken washing machine!
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