If at the end of the month there is always not enough money, then the point is not always in the amount of salary, but in the fact that we do not know how to plan our budget so that we not only have enough for everything we need, but can also be postponed for the future.
For some reason, the opinion has taken root in society that if a person does not have an impressive amount of money, then he does not need special knowledge in their management. But Evija Kropa, an expert at the Swedbank Institute of Finance, emphasizes that in reality the opposite is true: the less money you have, the more important it is to understand what each euro was spent on and why. And although financial planning often causes negative emotions, as it is associated with cutting and controlling expenses, it is the most reliable way to get out of the debt abyss and become more financially independent.
Those who think that tomorrow will be easier are deeply mistaken.
This applies not only to budget planning, but to intentions from tomorrow to do more sports, choose healthier foods, go to bed earlier, and so on. We usually plan to start life from scratch not today, but tomorrow, next week, or even put it off until later. But Evia Kropa is sure: “It is very important to act and start planning your budget, not tomorrow, but right now, because if we postpone and continue to live in the old way, there will be no result. Well-being, like the achievement of goals, does not come by itself. This requires decisive action, as well as clear control over incoming and outgoing cash flows. The sooner you start, the greater your success!
Do not waste your time on trifles, but focus on the main thing!
According to a study of financial planning habits, most often (69%) families plan their budget within one month, trying to make sure that there is enough money for regular payments and urgent expenses. But at the same time, one should not forget about long-term savings for the “airbag” and future expenses. “Undoubtedly, at the initial stage, many people really want to just deal with current expenses. But it is equally important to lay the foundation for financial well-being for the future by creating various targeted savings (for example, a savings account, savings for the future of a child, etc.), making contributions to a private pension fund, endowment life insurance, deposits, etc.,” notes expert at the Swedbank Institute of Finance.
10% for incidentals
When compiling a business plan, entrepreneurs, as a rule, include 10% for unforeseen expenses, because it is simply impossible to foresee absolutely everything. The same principle should be followed in the preparation of the family budget. If all your upcoming expenses are scheduled to the last cent, then the slightest deviation can lead to the collapse of a carefully planned budget and prevent the implementation of your plans.
How not to spend everything at once?
Another common mistake is spending money without restraint in the first days after the salary. Here you can even note a certain pattern: the tighter you had to tighten the belt before the salary, the wider you want to walk after the receipt of money in the account. To avoid this, it is better to divide the money remaining after the payment of mandatory payments into equal parts. For greater security, you can even transfer part of the funds to a savings account and order a certain amount every week for current expenses (free transfer from a savings account is carried out within seven days).