We all want to be able to save a lot of money, we do not want those who do not buy the things we want to buy, we also do not want those who always have low wages after a month and we do not save after a year. We know how these kinds of situations feel but what is behind it? Why are so many people not able to save money even when they want to save? Why are important things sacrificed to buy things that are not necessary?
I believe that this is due to lack of control and knowledge about money management, so in this article I will discuss four ways to give proper management of your money.
SET A BUDGET
A budget is a spending plan, this is done so that you know in advance if your income is sufficient. It is very good to have a budget because it gives protection to the money you earn. It will be easier to save if you have financial security, you can also control overspending, you can avoid getting into big debt and most of all you reduce your stress.
If we take an example, this is the best way to create a budget. We will divide it into three categories:
Income category
Expense category
Long-term goal category
In the expense category, think of the things you really need only food, water, internet, electricity and so on.
In the long term goal category are your expenses that are reserved only for the future. Just like insurance, savings account, emergency account and college fund if you have children.
After you have totaled your expenses category and long term goal, make sure it does not exceed your income. If you make an adjustment to your expenses or add another income.
Budgeting is personal because we have different incomes, we also have different expenses and priorities in life so you should make the budget to work for you and just stick to that plan.
YOU MUST HAVE A TRACKER OF YOUR EXPENSES
Do you know why almost everyone stays without savings no matter how big their income is?
They have poor spending habits and the reason why they have poor spending habits is because they do not track their expenses, they can no longer remember what and how much they are. All millionaires even billionaires use a system that tracks their expenses. They always know where their money is going.
This is because if you have a record of your expenses you are giving yourself awareness of the things you spend, you are not just spending money and you have no idea where your money is going and you are not even aware it turns out that your expenses are bigger than your income.
It is very good that you have a record of your expenses. It is better that you install an app for it. There are many free applications in the Play Store and App Store today or you can write them on paper. The important thing is that your budget is always protected and you manage your money well.
MAKE SAVINGS GOAL
People who set their savings goal accumulate faster and manage their money better than people who do not have a goal.
Just like the story of John and Peter. They both plan to go on vacation. John knows where he is going, he researches the place, he examines which part of the place is the best sights, where he will spend the night, which restaurant has good food and he also knows how much is possible total expenses on this trip.
So after he did the research, he immediately looked at his income and based on his calculation, he will only accumulate 15% anger on it, or within four months and he can go on vacation.
Peter, on the other hand, was undecided, he did not set a goal, he did not save and he just continued what his spending habits were then and as time went on he did not continue on his vacation.
Many of us have the same attitude as Peter. We want to save a lot of money but we do not want to manage, we want not to overspend but we are lazy to make a budget. We just want the result but we do not want the process.
There is a saying "Failing to plan is planning to fail" so if you do not want to be like Peter, set a savings goal today.
MAKE MONEY FOR YOUR LUXURY
There are three types of people who handle money:
The person spends only always because they believe that life should be enjoyed now. What else is your income for if you do not use it and another YOU ONLY LIVE ONCE.
It is too much to save, those who almost do not buy things and save all the money they receive.
Person who balances spending and saving. This is the kind of people who know how to manage and handle their money.
One secret to successful money management is having balance. Aside from saving and investing or the early planning of your long term goal you should also prepare for small expenses and set aside a small percentage of your income for your luxuries.
You do this every time you receive money and you use it to buy things that make you happy. Just like going to cafes, ordering expensive dishes from a famous restaurant or staying overnight in a High class hotel.
This kind of expenses is a very important part of your budget because in the end we are just people who have emotions, we want to enjoy life and at the same time we have savings.
I hope you learn on this article. Thank you for you in advance support. 💗
