For many people the mention of personal finance is akin to some unsolvable puzzle that bothers them at odd times. The thought of sitting down and planning expenditure is scary, and the idea of pre-paying the credit card bill, an alien concept. Such people are sitting ducks for target practice when finances go awry. It is in your own best interest to learn how to handle your personal finance matters effectively. Here are some tips that you can use.
Be Aware of Income and Expenditures
In order to understand your finances you need to know what money is coming in and on what it is being spent. It is a good idea to sit down with a pen and paper and list just how much money you have access to each month. Include the money that comes from your salary, any interest you get on savings, and any other sources of income you may have. Even if it is an irregular source of income, make sure you record how much you earn from it. Similarly make a list of all the main expenditures you undertake monthly. The rent, utilities bills, school fees, groceries, and medical expenses; make sure you list everything. Specific annual payments such as insurance and taxes should also be included on the list. You can revisit the list at a later date when you remember some that you originally missed.