Summer is over and as usually each year we have enjoyed the time on holiday and used the money we have budgeted for it. Well spent funds, a lot of fun and now we are back to normality.
The main motivation should be that you get back on track and continue developing and applying the best financial habits to keep your financial stability. You know about these habits; you have heard about them over and over.
It is simple, invest in yourself to make more money, save, invest and create a passive income. Further then continue living within your financial limits. There is nothing much more to the creation of financial stability. The fundamental principles have not changed even during the digital era. The way how we budget and structure our finances so we have a comfortable life with having all important needs met.
The principles remain the same. Then we need to focus on practising these simple steps. You will get great help in the implementation of these habits in the book Financial Habits as Quality investment in Yourself. If this topic interests you, this is all for you and hope you will gather your value and your missing pieces for your financial stability puzzle.
SET LONG TERM REALISTIC FINANCIAL GOALS
For the long term goals are your visions for the future. With setting up long-term goals, it is advisable that you also state your age limits for accomplishing these goals, which may help you on the way and be your motivation for your daily business or daily job you do. However, the goals need to be attainable and realistic.
IDENTIFY AND SET YOUR MONTHLY FINANCIAL GOALS
To help you with ideas about your monthly short-term goals, one may include the basic things:
ESSENTIALS:
Payment of your rent or mortgage for a house or for a flat you have just bought. The mortgage is a commitment for the long term and it includes the payment of interest. Therefore try to aim for buying your home with cash. Or at least try to minimise the amount of mortgage since the interest adding up to the cost of the purchase.
Specify your expenses for food, phone and internet. Obviously, expenses will vary, depending on the size of your family and household.
NEEDS:
Exclude your monthly saving payments, payment for a college fund and retirement fund. Or perhaps you have already set up your own investment account or have a managed account.
The managed account includes the managers’ fee, which can decrease the amount on your account. However, it depends on your ability and time available whether you are able to manage your own investment account.
Expenses for a car such as petrol and some extra money for the payment of insurance which is on a yearly basis. But you can start putting $10 on a monthly basis, which will ease your situation once the payment is due
WANTS:
Set up your budget for social entertainment and activities you like as hobbies. Perhaps you like to go for dinner once or twice a month, go to the cinema, play bowling or buying books. Entertainment can be in an inexpensive form such as a nice walk in nature.
And so there are still few months left from 2020 and after enjoying the summer. It is time to reorganise our finances with these simple steps and getting a financial budget planner will be a great help to you.
GET TO TRACK YOUR INCOME
The two biggest mistakes people make with their finances is that they don’t track their income and they don’t track their expenses (see next).
You might be thinking ‘but I earn the same amount of money every single pay, why do I need to track it’? Tracking your income doesn’t just mean you know how much you earn, it means you’re actively monitoring your finances and actively tracking them. But getting into this habit, you will find ways how you can create additional income or increase the current one. So set your foundation for financial stability by understanding finances, increase your level of earnings and manage them well.
Financial planners are great for tracking. I would recommend the physical planners and written by hand since this is the best psychological boost for your positive attitude towards budgeting.
You can get your detailed income and expenses planner on Etsy shop:
As you can see, the planner does all the heavy research work for you. The planner lists all potential incomes you may have. Like this, you can also find inspiration for any further incomes you want to generate and what you need to do in the way to get started.
If this is the planner you need, you will find it on Etsy and download it immediately. Don’t wait to start tomorrow. Allow yourself to start today.
ALWAYS TRACK YOUR EXPENSES
The even bigger mistake than not tracking your income is not tracking track your expenses, which can lead to emotional spending and purchasing items you don’t need.
The quick trip to the grocery store here and there can add up to hundreds of dollars over a month, especially when you go to pick up one thing for dinner and come home with 2 full bags of food.
Knowing exactly where your money is going is so important. You’re never going to be in control of your finances if you don’t know exactly what’s coming in and going out. A business would never survive if it didn’t track its expenses, so why should you take your finances any less serious
Financial planners are a great help here too. Get your physical planners and write plans by hand since this is the best psychological boost for your positive attitude towards budgeting.
You can get your ultimate financial planner on my Etsy shop:
HOW MUCH IS YOUR DEBT?
First and foremost, if you don’t have any debt and credit cards, great! Don’t even try to get these and focus on your income and ability to increase the number of additional sources.
If you already have existing debt, the solution is simple. Pay it off first as soon as possible and avoid any further borrowings. Once you are debt-free, this is the best foundation for your financial independence. The sooner you pay it off, you will also save money on the payment of interest.
Financial debt trackers are great tools to assist you here. You can tracker your debt, but also bills and spending much better so you know how to adjust them.
You can get your budget tracker on the Etsy shop:
KNOW YOUR NET WORTH
Like businesses prepare their balance sheets on a yearly basis. Iit is great if you know your current wealth situation too. Once you summarise all your assets and liabilities, then you can make decisions and take adequate steps towards minimising liabilities and increasing your net worth.
Understand that life is not only about finances, but great financial habits will make your life much easier and less stressful. Having your personal balance sheet will ground you and set your foundation for future steps.
If you are interested in setting up your financial grounds, I have prepared a personal balance sheet for you. The list of your asset and liabilities, that you can find on Etsy too.
DO THE RIGHT THING
Start to do the right things, spend your time wisely and invest in meaningful activities that will eventually increase your fortune and well-being. You need to take care of yourself first to be able to take care of others and get that return in the satisfaction that you have created value and also received a reasonable reward for it. Satisfaction in your personal life and your professional life, having balance.
Don’t try to lower your standards, but increasing them while increasing your quality of life and income streams. Here we still mean that you keep yourself at the rational level when it comes to your standards.
When you start to search for solutions, it may help you overcome perfectionism and related procrastination. Building up the mindset and taking on responsibilities will help you with your self-confidence. You have just been introduced to the great benefits of getting into your budgeting activities and also explained how you can improve your finances.
Would you have any ideas about what would you want to improve on your budget? Suggestions are always welcomed so let me know.
