Many people these days like to know where they are putting their money. They would establish a budget for their daily expenses or take a more active role in managing their expenses. However, they don’t know where they should start. This scenario is more common with young adults who have just started earning or got their first paycheck.
But with an abundance of expert advice, beginners often feel overwhelmed and confused about where they should start. So, if you listen to Dr. Vivek Bindra- the best motivational speaker in India, you can learn some really useful money management tips from him on his YouTube channel.
If you are starting your journey toward money management, we have got you covered. Here are 7 tips to help you actively track and manage your finances:
1. Think About the Destination
Though you can start without having a goal in mind. But that would be a complete waste of energy, effort, and money that you are saving. Most often, people work to get through their day and pay the bills. But seldom does anyone think about why they are working and what their goal in life is. So, apart from your expenses, income and savings, think about the final goal that you want to achieve in your life. It is important to have a vision in your life.
2. Track your Money
It is very important to know where your money goes every day, every week, and every month. This forms the crucial foundation for a financial plan. If you use cash, it could be difficult to track it down. However, you can always note down your daily expenses and monthly bills like rent, and phone bills to keep your money organized. This will help you to build the proper groundwork for a new financial plan.
3. Determine your Net Income
Before you retire, you need to save money to lead a comfortable life. Hence, saving is non-negotiable. When you are tracking your money down, ensure that the first thing that you take into account is to look at the net income amount. Your net income amount is what you save after 15% of your gross income goes into multiple different types of accounts.
4. Use Multiple Bank Accounts
If you use one single account for multiple purposes, it could be difficult to plan your budget. Keep your budget to under five categories and use multiple bank accounts for each category. This way you can easily track your account balance without having to number crunch each time.
5. Transfer Money into Investment Account
Budgeting is not always fun! It is hard, so you should keep it simple. Just transfer the amount of money out of your account to your investment account. Your investment account should be different from your savings account. By investing for the future, you are less likely to transfer the money back into checking and spending it.
6. Reach Out to Your Network
Entrepreneurs leverage more from forging relationships and growing their network. So, reach out to your network and you will be surprised to find some of the best templates and tools for managing finances by just asking other startup businesses. You can also hire a business coach to help you grow your network.
7. Understand Your Investment Goal
Are you planning for retirement or do you simply want to save so that you can fund your startup? You need to understand and be clear about your investment goal. It is also important to understand the investment horizon. Keep it for two years when investing in the market because the ‘buy low, sell high’ theory needs you to keep an eye on the market.
The seven tips from professionals will not just guide you on your way to saving money, but will also help you to create wealth. So, keep these tips in mind and let us know how they work for you!
Starting a business may sound exciting but is indeed a hard deal! If you have no prior experience, it could lead to a downfall. So learn the skills from the master via Business Coaching Program by Dr. Vivek Bindra. To know more, visit: www.badabusiness.com