Posted by:     On   February 28, 2018

To stay out of danger, effective financial management is important. However, not everyone knows how to handle their money properly; I have friends who tell me that they cannot explain what they did with their money. So, as an average person with no knowledge of financial management, how are you supposed to take care of your cash? Well, let me introduce you to some basic cash management skills.

One, you should start budgeting. Planning how to spend your money is one of the best ways to managing your finances. You will not only be able to keep track of your funds, you will also be effective in preventing yourself from spending more than you should. You can make a list of what you want to buy and make sure you stick by it. Don’t be the type of person that will buy items because you have seen them; work towards making sure you buy items you have already budgeted for.

Two, stop making avoidable or unnecessary expenses. Once you have budgeted, make sure you stick to your budget. I once took a friend to shop for clothes. I was surprised when the shopkeeper gave him a discount he ended up spending double the amount he had planned. The reason was that he had bought more clothes at less cash yet he had not budgeted for the extra expense. It is clear that the less unnecessary expenses you have, the less the chances of getting into debt.

Three, stop using credit cards if possible. The few people I have seen using credit card have said that credit cards are a slippery slope towards incurring debts. They make one spend money too easy and yet it is money you have not gotten yet. Instead, make sure you pay your bills as often as possible. When you learn to use the money you have, you will not only avoid going into debt, you will also be able to keep a close eye on the money you have.

Lastly, change your money mindset. It is helpful to first change your attitude towards money and how it needs to in your control. Whether you earn less than you would want, you can always make a budget and stick to it. It does not get any better when you start earning a lot of money, therefore, make sure you are disciplined with the small amounts you have so that the larger amounts will not be a problem.

View All

    Leave a comment