In the world of today, recovering from the world economic crisis, many countries are still fighting for their economies. Their struggle not only reflects on the global plan, but on the micro level as well. If you are one of the people who live pay check to pay check, without having a clear plan for the future, and feeling slightly insecure for your family’s future due to the aforementioned, there are some things you need to change when it comes to your finances.
Since people learn best from experience, mainly from negative examples, here is a short list of the things you should NOT do – coming from a person who knows how to deal with money:
Not having a Budget Plan
Planning is the core of money-saving. What you need to do is to make an annual plan with your general budget, and then split it into seasonal quarters for which you will dedicate a certain amount of money. For example, it is logical that you give more money on winter clothes in late autumn rather than in July (when that money can be dedicated to some other things, such as vacation).
Make a Plan
Your household budget plan needs to include the following: bills (this is essential because you need to pay for it every month and a lot of money goes on electricity, water, heating, phone, Internet, and other bills), living costs (food, clothing, education, books), financial products (insurance), medical treatment (drugs and therapy), leisure (sport, holidays, restaurants and bars), travel (means of transportation – public or personal car). Detect any other thing that can find its way to your budget and see if something really needs to be there (such as going on holidays twice a year).
Spending rather than Saving
If you do not realize where your money goes, it probably ends up in someone else’s pocket. Having a savings account means thinking about the future, which is why you should leave at least 5% of your monthly salary on a savings account rather than spending it on unnecessary things. Do the math yourself and you will see that you can save a lot this way. For example, if you have kids, think of their schooling costs. When the time comes for them to go to college, for example, it would be great if you can afford them this without going into debt. In order to achieve this, there are saving options for schooling.
Put Money Aside
Schooling can be a major burden in your family budget. One of the options can be to start homeschooling your kids. You will not have to pay for tuition and will save a lot of time and energy. However, the downside of homeschooling is the lack of socialization, but you can always take your kid to the park and other places to socialize with other kids. On the other hand, if you do opt for a private (or even boarding) school, you need to take into consideration a lot of factors, such as payment options. The majority of schools today offer their own deferred payment options, such as school easy pay system.
Not doing thorough Research
Money can fly away if you do not watch over it. Instead of buying in your closest grocery shop without asking for the price, do a thorough research of your neighborhood shops and see which offer discount and give coupons. A lot of them will also reward your fidelity, so make sure you look for all the possible options, such as payment cards (without getting into debt, of course!).
And remember, when you have enough money for living, be happy with it and do not overspend because this way of living can only come back to haunt you. And that is something you do not need in your debt-free life.