Best Habits in Managing Your Finances (2016 Update)

Best habits in managing your finances
Habits in managing your finances

Best habits in managing your finances

The success or the failure of one’s life always depend on their habits. If you have more good habits than bad, then the chances are the overall outcome of your life is good. This happens the other way around as well. Even though we will like a world within which money or finances will not have a say on the quality of life, at the end of the day, your finances and how you manage them truly decide what kind of a life you will live. If you have faced the situation of not being able to do something you like merely because of your finances, then it is about time you build a few good habits in managing your money.

 

Spend less than you earn

While this may sound obvious to many people, most of us spend more than we earn thanks to credit cards we own. Managing your credit is a skill on its own. However if you are looking and good finance habits, the first thing you should focus on is not going above than your total earnings for the month when you spend. As you save and invest your money, there will be a time that you can afford to be more lavish with your lifestyle. But until you get there, you should strictly cut down your expenses to at least balance your budget at the end of the month.

 

Track your expenses

It is easy to mindlessly spend most of your salary within the first few days of the month if you are not conscious about how you spend. Therefore, you need to manually or digitally keep track of your expenses. You can start off by only noting down the relatively bigger expenses and move on to the smaller ones. Once you get the hang of this habit, you will noticeably spend way less especially when it comes to impulse buying.

 

Pay your bills as soon as possible

While this may sound a little counter productive, paying your bills especially the credit card bills as soon as you get your salary will treat you positively in several different ways. First of all, it will keep your mind at ease for the rest of the month. Secondly, it will keep you from being charged high amounts of interest for the credit you have used.

 

Buy things of value

This, again, may seem a little counter productive when speaking of good financial habits at first. However, only buying the things of good value will save you money in the long term since the quality items usually last longer. If you are on a tight budget for a long period of time, buying cheap shoes every 3 months will cost you more than buying a good pair of shoes that will last for years. You need to understand that not everything is good because they are expensive. If you are going to splurge on a quality product, make sure they are actually worth it at first.


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