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How to manage your finances effectively?

Managing money is key to making it yield and grow. That is why it is so important that you know how to do it in the most effective way.

In most cases, it seems not to yield, because you always have to allocate a good part of the income in unavoidable expenses .

What we also forget many times is that there are certain expenses that can be avoided. But it is impossible to visualize it if we do not carry an order in our finances . First of all, you should know that managing money and acquiring the habit of managing it every month is an excellent opportunity to increase your abundance.

 

How to manage your finances effectively?

Keep a record of your money

Keep a record of your money

At this point you have to consider your fixed income, and those that occur sporadically.

All the money that enters your life you should write it down, just like all the money that comes out. And this is for a fundamental reason. Without the control of our money, we lose sight of what is going on, how we spend it, or how much money it means to have certain habits.

Then, it is essential to keep a constant, and above all very strict, record of all the transactions you make, no matter how small.

In this way, you will be closer to visualizing the management of your money and identifying opportunities that would otherwise go unnoticed.

 

Budget everything

Budget everything

However, the ideal is that all that is planned, that everything is budgeted. Because when it isn’t, we usually tend to spend a little more than normal.

Sounds a bit overwhelming, but getting into this habit will help you a lot to not spend more than necessary. If you have all your money available, you may spend it all. I left only as stipulated in advance.

 

Pay your debts

Pay your debts

At this point it is very important that you can face your debts without continuing to acquire them.

If, for example, you asked for a personal loan to face some unexpected expense; So don’t ask for another loan to safeguard the previous one. Paying off our debts is a fundamental part of good financial management. Another tip at this point is not to use credits for things that don’t reproduce money.
There are things that you can acquire to generate money and that you can pay on credit; A future investment.

So, when there is no return on investment, acquiring a debt or credit for that, usually results in losses.

The main objective in the arrangement of your finances is to be 100% debt free.

 

Set aside fixed money for savings

Set aside fixed money for savings

This is a great way to save and keep your finances healthy.
When you receive your monthly money, make a habit of saving a percentage.

Financial habits are what allow people to reach abundance.

 

Plan your expenses in advance

Plan your expenses in advance

Before you start keeping track of your finances at the beginning of the month, write down how much you think you spend monthly , and in what things that money goes away. And, at the end of the month, compare that initial list with the record of all your true expenses.

There you will find out if you really have the ability to identify your expenses and project yourself financially, or not.

 

Control your emotions

Control your emotions

You must have absolute control of your expenses. There are things that are absolutely unnecessary, there are others that are perhaps some desires or desires deserved, but that you have to budget and project in advance.

On Inspector Lestrade issues, many excellent decisions come from self-control.

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