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How to control your finances

If you are in a financial situation that does not suit you, you need to change personal habits and patch up “holes” in the budget.

We wrote some tips that will help you understand the money picture, increase income and learn how to control your finances.

1. Start keeping a budget

Start from scratch – get a budget. Find out what size of your income and determine basic monthly expenses. Having written and calculated them, you will see a positive or negative balance. Of course, it is important that the expenses do not exceed the amount that you earn. This will allow you not to borrow.
It’s difficult to cover all the small issues related to money. Start with a clear spending: transport, rental housing, rent, food and groceries. Gradually analyze the remaining expenses that you make per day and add them to the budget. Review it periodically. Knowing your position is the foundation of money management.

2. Reduce bills

The easiest way to change the budget balance in a positive direction is to pay less for various services. After spending a little time, you can find the best conditions for telephony, television, banking, Internet charges. It’s not necessary to fight for a penny or agree to the worst offers. Just check: suddenly there is an opportunity to pay less for the same product or service and switch to another tariff.

3. Eat less in establishments

One of the easiest (and, of course, pleasant) ways to waste money is to go to a restaurant or cafe. Periodic trips to a good institution are normal. Holidays, weekend meetings are pleasant and convenient to spend in such an atmosphere. But if you dine every day in institutions, it is expensive. Just count.

Challenge yourself – try cooking and eating at home for a whole week. Take lunch to work with you. You will be pleasantly surprised how much this is a big savings..

4. Plan the menu

If the idea of ​​cooking every night scares you, the situation can be simplified by planning the menu a month in advance. This approach allows you to control your finances and save energy for several reasons:

• You spend much less time in stores, as you buy immediately for one or several weeks.

• You spend less time cooking because you can make food preparations for a couple of days in advance.

• You can buy products in bulk in large hypermarkets, where prices are usually lower.

Services or applications for planning the menu will help those who have difficulty with imagination. For example, Easy Menu for Android, IOS and Web.

5. Read about personal finances.

If you want to be with the money for “you,” but it’s not clear where to start, read books on personal finances. They open up new points of view, structure knowledge and tell “which side to approach” to money. Here are five classic options:

• “The Richest Man in Babylon” – George Samuel Clayson.
• “Rich Dad, Poor Dad” – Robert T. Kiyosaki.
• “Think and Grow Rich” – Napoleon Hill.
• “The path to financial freedom” – Bodo Schaefer.
• “The Science of Money” – Brian Tracy.

6. Learn about investments

One of the main steps in creating personal wealth is to start investing. If this scares, try to study a question in more detail. Read literature for beginners, sign up for courses, try a service or application where you can purchase several stocks in demo mode, for example, tezis.io.

A sensible investor sees the purchase of securities as the purchase of a share of a business. Therefore, it is important to evaluate the financial results of enterprises for several years. Nobody wants to acquire a company with an ineffective business model. Give up speculation, playing on the rise and fall of stock prices throughout the day. This method is risky and often leads to loss of capital. Invest Medium or Long Term.

7. Set real material goals

To effectively control your finances – you need to determine the goal. What do you want to achieve, why are you trying? Unless you have specific reasons to work, it will be difficult to motivate yourself to save money every month. Set a measurable goal. “I want to be rich” is a blurry installation, and “Accumulating 3 million per apartment in 5 years” is a clear task.

But stay realistic. With an annual income of 1 million rubles, it will be difficult to buy a yacht. Make sure the goal is achievable and divide it into small steps that will help you track the process and feel successful..

8. Build a financial plan

The financial plan should cover all monetary issues and the time period required for their implementation: purchase of real estate, pension, tuition fees for children. Any goals become elusive in the absence of a plan. It is necessary to understand how they are interconnected, in which moments they interfere, and in which they help each other. So, you will know when to switch between tasks and concentrate all attention on one or two, which are priority at this point in time.

9. Give up credit cards

In order to stop “misery” every month and begin to control your finances – stop using credit cards. This is one of the most “toxic” types of debt, where high interest is charged. Try to close liabilities to the bank. Ask him for the exact amount you have to pay. Determine the period and maximum monthly payment that you can make to cover the debt and which will not hit your base budget for a month.

Set debt repayment a priority, and after you say goodbye to it, proceed to your financial goals. Try to repay the loan yourself. Do not take another loan or microloan to pay off your monthly payment. This is what drives a person into a deep debt hole. If there’s absolutely nothing to pay, it’s better to borrow money from friends or relatives.

10. Start saving

Accumulation is an important part in financial matters. Regularly set aside a percentage of any income (salary, bonuses, cash gifts). On the recommendation of financiers, it should be 10%. If it’s difficult for you to “tear off” such an amount from the budget, try starting with 5% or even 1%. This will help to form a habit of saving. Over time, gradually increase the percentage. Remember that it’s important to save money before you start, not after spending.

11. Have a financial post

An interesting challenge that you can challenge yourself in order to learn how to better control your finances is the “hunger strike”. Set a specific time period and determine the minimum budget for it. For efficiency, it is better to conduct such an experiment for a week. We’ll have to review food purchases, leisure, transportation costs. This practice knocks you out of your comfort zone, but it teaches you to think freshly and understand what things are really important.

12. Take care of your retirement

It is necessary to control retirement savings from the moment you start working. Standard government contributions are almost guaranteed to be insufficient. Therefore, create a personal pension account and start saving for old age. It is not necessary that they be in a commercial pension fund. You can use bank deposits. So, you protect money from inflation and earn a little.

13. Find additional sources of income

Sometimes financial problems are associated not with large losses, but with weak revenues. Try to organize additional income, for example, renting out property or making money online. This will strengthen the financial situation and not allow negative circumstances to hit him hard. We wrote about the ways to help create passive income. here.

14. Improve your work skills.

Improving professional skills is one of the foundations necessary to hold onto positions, increase pay for one’s work, or move to a more worthy position. Stay competitive. Get certificates of additional qualifications, go to courses, develop skills that make work more efficient:

• Social skills.
• Creativity.
• Analytic skills.
• Positive thinking and stress tolerance.
• Ability to put knowledge into practice.
• Patience and perseverance.

And do not forget that it is important that all this is visible to the employer.

15. Get the most out of your work.

Good companies offer employees health insurance, dental care, free sports, meals, transportation and office services. But not all workers enjoy such benefits. Be sure to read the full list of bonuses from the employer. Some of them will help to save more than one thousand rubles..

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