The main purpose of managing finances is to ensure that the money we have can be used optimally by meeting all existing needs, managing money is one way to achieve financial peace.
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Therefore, it is necessary to have sufficient knowledge so that we can manage the finances that we have to the maximum so that we can meet every need in a targeted manner, remember "need, not will".
Money management can be done from simple things such as recording monthly needs, recording all existing expenses and income, or to further things such as investments and things that are still equivalent to that.
Here Are Some Of The Benefits Of Managing Money
1. Accustomed To Live Frugally
Frugal living is a pattern of life by prioritizing what is a priority need to be met and separating things that only become a will that does not necessarily have a contribution to our survival.
2. Avoiding Debt
By managing the finances we have, we become aware of what priorities must be met. In this way, what happens is that our finances become more clearly directed to anything, and can prevent us from debt.
3. Avoidance Of Stress
Believe me, when all our money is organized and managed clearly, our minds will not be too work harder to think of things that if not useful and can also prevent us from the desire that is not necessarily useful.
After knowing some of the benefits of managing money, then how do we manage money? here are some ways you can manage your money.
1. Record expenses and income
When buying an item or using a service immediately record the costs that come out for it, and if we get some money then also immediately record the money we get. You can record it in a book or if it is safer it can be recorded on a Handphoen or Laptop.
By recording all expenses and income that exist, then you can know so far the money you have is used for anything and comes from where, at the end of the month you can evaluate the expenses you use, so you will be wiser in spending money.
2. Determine the need and willingness
It would be nice to make a monthly list of what you should buy, such as food and drink needs, internet, electricity, and other things that if you will always need, then make a list for the wishes that you might want to buy.
By recording the needs first you will become more aware of the money you have will be directed anywhere, of course it is different if we do not have a list of needs, which will happen usually we will be easier to buy something without thinking more about whether it is useful or not.
3. Investment
Investment is an activity carried out by placing a capital into an asset, object, or institution in the hope that the capital placed earlier can provide benefits to investors (people who place capital) within a certain period of time.
By making this investment, you will have an asset that you can use when you really need money, you can try to invest in assets such as gold, stocks, mutual funds, etc. Investment is an activity that requires qualified knowledge to be effective.
4. Saving
Maybe from childhood we are often asked to want to save by our parents, it is in addition to training us to save is also useful for the future, saving is an activity to save some of the money we have to an institution or institution, the most common example is saving at the bank.
5. Perform A Financial Evaluation
Do not forget at the end of each month to evaluate our finances, try to see a list of our expenses and income for one month, determine whether our expenses have been comparable to the income we have and can meet all existing needs.
This evaluation is certainly more effective not only at the end of the month, it can be done once a week or even every few days to be more detailed and there are no missed expenses and income.
Closing
Those are some reviews on how to manage money effectively, hopefully it can be useful, don't forget to try some of the tips above and feel the benefits, managing money is the first step towards financial freedom.
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