How To Control Your Money

Track your money:

The first step to be in complete control of your money is that you

should be first aware of how you spend them. You should be able to

track each and every cent that comes and goes. This is absolutely

necessary because there is always a difference between how we think we

spend money and how we actually spend money.

This activity can be performed in several ways: a simple notebook can

be used or the help of online software can be availed. Built-in money

tracking apps are also present in smart phones. So, there is a

plethora of ways through which we can and we should track our money.

After you have tracked your money, you can easily identify the key

areas where you are wasting your money or where spending needs to be

cut. Half of the problem gets solved here.

Save for emergencies:


Out of your income, you should always plan to save a portion of it for

emergencies. It could be 10% or 20% or 30%. No matter what happens,

always make a habit of saving for later use. This comes in handy in

case of emergencies.

Also set a portion of your income to slowly and steadily pay off the

debts you have incurred so far.

Why put all eggs in one basket?

There is a famous saying that goes never put all your eggs in one

basket. It can also be applied to managing money. Never ever rely on a

single source of income. Always be on the lookout to create

opportunities to earn. Always have a secondary source of income. Sell

old stuff. Convert your hobbies and passions into a source of income.

Whatever you do, try to maintain a secondary source too. People who

are young and energetic enough usually take up a second part-time job.

Apply 50/20/30 rule:

Another method is that the 50/20/30 rule can be applied to your

income. This rule is applied to the income received after taxes have

been subtracted. This rule states that fifty percent of your income

should be set aside for your needs i.e. things for which it is

mandatory to pay (housing, food, utilities, transportation etc). The

20% has to be saved. The rest of the 30% can be spent on wants which

can include recreational facilities etc.

Credit cards? What are they?

You need to get over credit cards. Many people due to their laziness

and lack of foresightedness start to rely a lot on credit cards. This

creates unnecessary debt on them. To avoid this, they should stop

perceiving credit cards as their saviors, even in the case of

emergencies.

Invest, invest and invest:

Always be willing to invest. Invest in gold, invest in yourself,

invest in education etc. Invest in anything which is sure to get you

some returns.

Control your urges:

Let us make a pact not to be impulsive. Sometimes, we do not need

something yet an impulsive urge forces us to buy it. It is better we

learn to control our urges as in the words of Warren Buffet: "If you

buy things you do not need, you will soon sell things you need."

Avoid spend thriftiness:

All wrist watches show the same time and perform the very same

functions. Why do we possibly have to buy the expensive ones?

So, this is an opportunity to apply the above-mentioned techniques and

to relieve you from the stress of loans, debts and bad money

management. It is time now to be satisfied of your finances and be in

control of them.

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