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It 6 Sustainable Personal Finance Habits you must know
There are times when we feel like our financial lifestyle is no longer sustainable, some reasons could be the fact that we are actually spending much more than we are receiving, when this occurs, it’s very easy to run into debts.
This situation is peculiar to a lot of us, but don’t worry, that’s exactly why we are here. If you are tired of living paycheck to paycheck or maybe you have that feeling that your financial future is uncertain, You’re definitely not alone.
Many people struggle with managing their finances and staying on top of their spending. But I am assuring that if you are able to develop sustainable personal finance habits, you can actually take better control of your finances and go ahead to build a secure financial future for yourself.
In this blog post, I will try my best to guide you through some of the most effective and sustainable personal finance habits that you can start practicing today.
I am not promising you a hundred percent certainty, but if you are able to follow these guidelines, trust me you are going to see sharp improvement, everything definitely lies on if you will apply what you’ll be taught in this post.
1. Make a budget:
Most of us really do undermine budgeting when it comes to how we spend our money. To some people, once there’s money in our hands we automatically start spending money irrespective of the fact that we may not actually need what we are going for.
Budgeting is the foundation of good financial management. For a start, you need to create a realistic budget that takes into account your income and expenses.
Let’s say your income is $1000 a month while your planned expenses within that Month is around$600. Your budgeting should be within the $600 market cap.
Based on this, all expenses should be arranged within a scale of preference. When I say scale of preference, I mean starting your expenses from the most important to the least important expenses.
If you have any financial emergency that might affect your budget, all you have to do is to update your budget regularly to ensure it reflects your current financial situation.
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If you are able to budget your income and expenses, trust me it’s sustainable to your personal finance habits.
2. Save automatically:
Years ago Before I started saving automatically to my savings account, once money drop into my main account, I will promise myself that I won’t touch a particular amount from that money, before you know what’s going on, the Money I said I won’t touch will be used by me.
This particular trend continued until I said to myself, it’s time to do something different, I decided to open a savings account, what I do with the savings account is that I linked it with my main account, when money comes into my main account, a particular amount is automatically transferred into my savings account.
With these steps I found out that I am now saving a huge amount of money monthly. It worked for me, it could work for you too, all you have to do is to set up automatic transfers to your savings account each month. This will help you build up your savings without even thinking about it.
3. Pay yourself first:
If you haven’t heard about the “Pay yourself first” habit, then don’t worry, I’ll explain everything to you. Paying yourself first is a personal finance habit that means you pay more attention to saving and investing money before spending on other things.
What this means is that before you think of paying for bills , entertainment, or even shopping, you have already mapped out a considerable amount of money that would help your career in the longer run.
It’s a habit that helps to make sure that you consistently put aside money for your future, it could be for retirement, or maybe a down payment on a house, or anything else you’re saving for.
The idea is simple: as soon as you receive your paycheck, all you need to do is to transfer a portion of it into your savings account or investment account. This is before you pay any bills or do any other expenses that’s not of immediate importance.
4. Live within your means:
To some people, once money enters their hands, they just want to do what everyone else is doing without considering their income.
Your friend who has a $800 Versace might be earning$5000 monthly, he still has enough to save even after buying the Versace.
You can’t use his situation to compare to you who’s on $1000 monthly, if you buy the Versace at $800 with him, you’ll only be left with$200.
So you see, try to Avoid lifestyle inflation by living within your budget. If you can’t afford something, don’t buy it. Learn to differentiate between wants and needs.Needs are a necessity, always go for them first.
5. Pay off debt:
Being in debts is not an ideal situation, but there are times we might get overwhelmed and borrowing becomes the only option to come out of our situation.
When you borrow money, try to always make a plan to pay off your debts.
In order not to incur a lot of interest in the future, you should start with the ones with the highest interest rates. Being debt free will certainly give you the platform to do our last habit for the day which is to invest regularly.
6. Invest regularly:
Investing regularly is definitely a key personal finance habit that will help you build wealth overtime. Most billionaires we praise so much are what they are today simply because they invested during their early stages.
If you have the means, try to Invest in stocks, bonds, or other assets to grow your money over time. Trust me with the right investments, you could scale up your income within a period of time.
Final Thoughts on 6 Sustainable Personal Finance Habits you must know
If you really want to be financially disciplined, you must follow these 6 sustainable personal finance habits you must know that we’ve mentioned above, they’ll guide you from where you currently are to where you want to be in future