FINANCE: Steps to better money management

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Finance

There are a few steps to take to be smart with money regardless of how much you have

  • Step one is to set a budget. One of the strongest practices is to adopt a 50-30-20 breakdown approach. The amount that goes into your bank accounts each paycheck splits it into these three parts below: 
    • 50% needs: Expenses you obligated to pay.

     

    • 30% wants: such as rent utilities, entertainment and foodstuffs.

     

    • 20% Savings / Debt Reduction: Money you save, or money you set aside to pay down debt.

 

  • Step two is to establish a saving goal. This gets easier when you work saving into the budget you made in step one. Start by saving for an emergency fund and then for other long-term goals, like home and vacation.

 

  • Step three is to get a handle on your debt. Start by adding up the debt you have and figuring out how much it is costing you each month. From there, you can create a plan to pay it off that fits your budget and savings goals.

It is essential to realise the best option to establish money management with the ideal approach. Don’t be too anxious over which one to pick you can fly with what sounds clearer in your present plight.

By: Omo Jigaloye

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