I can not think of one person that actually wants to be in debt or live pay check to pay check but people actually want money in their checking accounts. Most people want to start taking control of their financial life, but have no idea where to get started. With the world in the shape it is today, managing personal finance should be at the top of everyone’s list.
It is a part of our genetic make-up to feel a sense of urgency when we get motivated. When most people realize the need to do something to fix their financial situation, they usually want to take action immediately. Since most of us are not educated about managing personal finance, we seek to get educated when the motivation hits us. They usually head to Google, the book store or find a financial manager if we can still afford one. It does not take long for motivation to fade and by the time they finish reading the book and doing research, they tend to be less motivate than when they started. I have put together a small quick start list to get you moving when your motivation is peaking.
- Go and get a book on managing personal finance. I was not saying not to read or do research. This is just a list of things you can do to get the ball rolling now, you will need to learn as much as you can about managing your personal finance and as the saying goes… education is fundamental.
- Gather all the information you can. How much debt you have, your monthly and yearly income, investments, bills, credit debts, Church tides and offerings and especially the money you spend on miscellaneous things. List them by category and be honest. You will only be cheating yourself.
- Make a list of everything you buy for at least a month (three months is better). It will surprise you what you spend you hard earned money on. This will confirm where every cent of your money goes and where you can start to cut back.
- Start saving now. Make positive that you put at least %10 of your income in a saving account of some kind. This might seems impossible, but think of the alternative. Not having anything saved at all leaves you wide open to falling right back down. If you get sick, you will have something to fall back on until you are well. Live for today an plan for the future!
- Saving sooner rather than later is extremely important. Say you just had a child or are planning on having one soon; you’ll want to start putting money away for their education as soon as possible. Open an account like an RESP (a Canadian tax-free savings account that can be used to contribute funds for a child’s post-secondary education) as soon as possible – you’ll definitely thank yourself later.
Get started with this quick list, while you read and do research to gain knowledge. Learning to Manage personal finance will not happen over night. Stay consistent and apply what you learn when it fits your circumstances. Like I have said before, the best tip I can give is to stick with it and it will pay off.