Guidelines of Personal Financial Management.
People have what they want to achieve in their minds either in a short span or after some considerable time. Management of your income is very critical to ensure that you can fend for your daily needs and also save for your goals.
You should do your financial planning because you understand yourself better including what you earn and your needs and goals. Most people sink in heavy debts because they are involved in buying things that they had not planned for hence they spend way too much. As we plan our finances it is a requirement to stay disciplined to the course so that we can achieve what we are working towards.
There are programs on the internet that could help you in planning your finances all you have to enter is customized information about yourself, and you can also consider taking time and write down about your finances and what you need to achieve. Before planning on what you will start doing in the future, you need to evaluate your current status and establish what needs to be done. Evaluating your current status will show you where you are and what you should rectify to move towards your goals.
Another important aspect is to document about your sources of income, and you should write down all sources including those that are not guaranteed. After generally documenting your income sources, you need to classify the income that is assured and that which is unexpected like gifts. Your guaranteed income should be the one to finance your major bills like rent, food, etc. and the bonus cash could be used for something to treat yourself.
You must also group your spending into either basic or luxury spending for you to know what goes away and what stays. As you group your sspending you should not forget about the small things that may be a big part of your spending like airtime, fuel or transport cost among others. Your needs should be managed by the income that suits its relevance and as you cut down on what you may term as not basic you should set aside a small percentage of your income to reward yourself so that you are not so hard on yourself.
You must set your goals as they will be the driving force for you to spend more wisely and the goals could be short term and long term, and that will enable you to save up. You should also have a policy of living within your means which translates to not borrowing to finance your activities and having a savings plan that will ease your savings goals.