Effective Money Management

We hear so many management themes such as human recourse management, office management, business management etc. whatever may be the theme the core is to manage or control the things effectively. It includes steps to take effective and smooth going of things related to the theme. Here money management also includes planning and controlling your money matters such as fixing your financial goals, budgeting, avoid unnecessary expenditures, saving and investment, capacity to bear risk etc. etc. It requires taking decisions according to the current scenario, economic movement and considering the internal and external matters affecting money matters. When considering the management of money it includes both inflow and outflow of money in various forms and sources.

Money Management strategies

1) Always Ask for a Discount:

If it is not a fixed price store, there is a 70% chance that you will get a discount if you just ask for it. If you get a 10% discount, it is equivalent to earning an immediate 10% return on your money. Over the long term, you will save a huge amount that will accelerate you even faster towards your targeted net worth.

2) Always Ask for a ReceiptAlways get a receipt so that you can track every single expense at the end of the day and, if possible, claim it as a business expense and get a tax deduction.

3) At the End of the Day, Record all Expenses in your Daily Expense Sheet

4) At the End of the Month, Update Your Monthly Income Statement

At the end of every month, add up the total expenses from your daily expense sheet and update your monthly income statement. At the same time, update all your income for the month. Deduct your total expenses from your total income to get your monthly savings.

5) Make Budgets:

You need to make a budget and follow it unfailingly. Always purchase what you really need and never go out to the market without a purpose. You should make sure to save at least 10% of your monthly income in your bank account, and make your best efforts to increase this figure.

6) Shopping :

When you go out to the market, do not take extra cash with you and always leave your credit card back at home. If you do not have money, you will not be able to spend; it’s as simple as that. You should avoid impulsive shopping under any circumstance and if you think that you will not be able to control yourself, it is better to give your wallet to the person who is accompanying you to the market and tell him to stop you when you are shopping some unnecessary item.:)

It is not a surprise that money matters seemingly hit the young generation the hardest. This is because they do not have very good money management skills and they have a natural tendency to spend all that they can on latest gadgets and luxuries. One major factor that contributes to this is that getting loans has become very easy now-a-days. No matter what your needs are, try to avoid borrowing money unless there is an unavoidable emergency.

If you own a credit card, make sure to pay its bills regularly as credit card loans perhaps come with the highest interest rate.

You must use a system to track where every single rupee goes. Only when you know where your money is going, can you take steps to channel it to your savings and investments