Personal finances are often a source of concern for most people. It is not easy to balance expenses and income every month or even to be able to save. If you are in this situation, it is time to reconnect with your finances. And then, it’s not so difficult, it’s only a question of organization!
1. Start by taking stock of your financial situation
Even if at first it seems daunting it is important to make an overall assessment of your personal finances so that you can subsequently have a healthy relationship with your finances.
Several questions to ask you:
- Do you regularly take stock of your finances? What was the last time you did it?
- What is the balance of your debts? The amount of your savings and / or investments?
- Do you have long-term goals for your finances?
You must carefully establish your monthly income and expenses to know where you are. This will allow you to have a clearer view of your financial situation so that you can better organize yourself.
2. Do you organize
The organization is a key point in creating a healthy relationship with personal finances. Often the problem is not having enough resources to cover all your expenses but rather that the resources are not used properly. So, if you already know what your fixed expenses are every month, set them first. This will allow you to know what your budget is for leisure and savings, and you will avoid spending before having honored your bills.
Write down your total income and total expenses:
- In income, you must integrate all your resources such as your salary, your rental income if you are an owner, your benefits from public or private plans (retirement, insurance …), your allowances (housing, children …), your alimony, your investment income and all your other income.
- In the expenditure part, it is important to take everything into account. Think about the expenses related to your home (rent, bills, taxes, insurance, furniture, condominium fees, maintenance of the house), your transportation (public transport, gas, car insurance, registration, driver’s license, maintenance and repairs) , parking), food, insurance, and your loans.
The income-expenditure balance will allow you to have a clear idea of your financial situation. This will help you prioritize your monthly expenses and ensure that the largest expenses are insured each month.
3. Pay off your debts and learn to prioritize
If you have debts it is important to manage them head-on. It will also allow you to sleep better at night and have a healthy relationship with your finances. Talk to your banker, who can offer you repayment plans according to your situation and your profile.
Be especially careful when repaying your lines of credit. The latter are subject to interest that can sometimes be high depending on the banks, especially when you pay late. If you have a credit card, remember to meet the repayment deadlines.
Saving is very important. This allows you to have security in the event of a problem. Try to put a little money aside every month. This will allow you to carry out a project that is important to you or simply to have more funds in case of a hard blow, to manage the big expenses or for your retirement.
Personal finances are not so complicated. Organizing in a better way will allow you to be more efficient in the income-expenditure balance and even to carry out savings projects in the long term. This will allow you to have less worries and enjoy life even more. Having a healthy relationship with your finances is not so complicated.