Improve Your Money Management Skills

Improve Your Money Management SkillsMany people have problems managing their personal finances, even when they are proficient at managing a business. One of the first mistakes many people make is combining their business and personal finances in the same accounts. If you are running a business of any kind of size, establish a separate bank account and keep separate records for your business and your personal income. Managing your personal or business finances accurately requires you to keep accurate data in a secure, organized system.

It isn’t unusual for people to question where their money went when they suddenly find themselves short on cash before payday rolls around. We often spend money without thinking about where it is going or whether it is a good idea to spend it at all. Stores depend on you to make spontaneous purchases and place items in strategic places to encourage you to do just that. Once you start writing down every dime that you spend, you will be able to get a better idea of where your money is going.

Make a list of all your essentials that must be paid on a monthly basis. Items that are paid less frequently such as car insurance or income tax installments should be averaged out and included in your monthly expenses. Be realistic about what is really a necessity and those things that you can do without. Subtract the total amount needed for essentials and the remainder is what you have to work with for nonessentials like entertainment.

Be sure to include savings in your budget, even if you can only afford to put a small amount aside each payday. If you get a financial perk, such as a tax refund or a bonus at work, put it towards essentials and savings before using it for nonessentials. If you let any of your bills ride to pay for a special treat, you will end up losing even more money when you have to pay late fees.

Credit card companies have an annoying habit of increasing your interest on your balances once they are tapped out. One tactic to help you get out of debt is to find a credit card that gives you 0% interest on balance transfers and eliminate the credit card with the high interest rate. Make every effort to pay off the entire balance while you are still getting interest-free balances. Once the introductory period ends, interest will apply.

Use apps to help you save money by comparing the price available at a retailer’s with those offered at competitor’s sites. You can enjoy savings and get refunds deposited into your bank account or on a gift card. Either way, it’s extra money that can add up fast.

Another way to cut spending is to not carry cash with you. Most people are less likely to spend when they have to rely on a debit or credit card to make a purchase.

Improve Your Money Management Skills Credit Picture License: Money in Hand via photopin (license)

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