It is never too late to look over your home finances and make an appropriate game plan to help you in everyday life and in the future. The post discusses ways to strategize your personal finances to gain maximum benefits from your earnings.
#1 Review Your Finances
Before you make a budget or take any financial decisions, understand your current financial situation. This is a basic step where you list down your monthly income and all your expenditures. It is a good idea to make a list of all your expenses for a month. A lot of people are surprised to find out where they have been spending their money. Include all payments such as bills, debt, groceries, insurances, entertainment, services etc.
#2 Financial Game Plan
Secondly, define your priorities. Personal goals determine where you should allocate your money. In case you are working part-time towards a big promotion, paying for housekeeping will save you money in the long run. However, if you have an hour free every evening you can skip housekeeping and do the chores yourself. You can use the extra cash for a vacation or invest it. You can read an independent review of bdswiss here.
#3 Create A Budget And Follow Through
Surprisingly, the majority of people avoid budgets because they believe it is too restrictive. In reality, a budget will allow you to make smart decisions while enjoying yourself. The key is systematic budgeting. Instead of focusing on small expenses such as takeout coffee, focus on big expenses. Is it possible to move and rent cheaper accommodation without drastically declining your quality of living? If your personal vehicle is a major expense, can you switch to public transport or live closer to work? Such changes can significantly improve your financial situation.
Most self-made billionaires use the 50/30/20 Rule. It is recommended that you spend 50% of your income on needs such as bills, utilities, debt and other requirements. The next 30% should be spent on wants and desires. Finally, the 20% should be invested in your future and savings. Savings will ensure you have sufficient cash as emergency funds for unforeseen events.
#4 Pay Off Debt
No doubt that a debt can weigh heavily on your finances. It should be your top priority to avoid debt for unnecessary purchases. In case you have debt try to pay them off sooner as the interest builds up. Debt lasts a long time if you only make minimum payments. The quicker you pay them off, the less amount you will have to pay.
#5 Retirement Savings
Everyone has to retire at some point. Most companies offer their employees 401K account facility. A certain amount is deducted every month directly from the salary for your retirement funds. In case your employer is not offering a 401K account you can create an Individual Retirement Account (IRA) at a reputable financial institute.
Never make investment decisions based on emotions. If you are unskilled to make a decision about your retirement or hesitant about a financial scheme, always consult a professional. You can find licensed online brokers to guide you at copy trading forex brokers. Read their full review before you consult them.
Lastly, make sure to do a regular review of your finances and evaluate your decisions to stay on top of your home finances.
Author: George Rossi
George is the Chief Market and Broker Analyst at brokertested.com. Prior to being recruited by brokertested.com, he served SVS Securities as Chief Market Analyst for two years. Earlier, he joined Morgan Stanley in Nov 2013 as Research Analyst.
George is a well-rounded financial services professional experienced in fundamental and technical analysis, global macroeconomic research, foreign exchange and commodity markets and an independent trader.