Money Management Tip #1 – Have a plan

Most of the people I know always complain about the lack of money and “how much month they have at the end of the money” 🙂 However, if you ask them how much more money they need and for what, they can’t give you a straight answer.

Throughout my life I learned that planning is everything. It is very likely that your plans might change quite often. As we grow our targets, dreams and goals alter, but the most important part is to have them written down and making baby steps each day in the right direction. A lot of people have no idea how much money they want to earn and by when and that is the main reason they do not get anywhere.

“Would you tell me, please, which way I ought to go from here?”

“That depends a good deal on where you want to get to,” said the Cat.

“I don’t much care where –” said Alice.

“Then it doesn’t matter which way you go,” said the Cat.

So, here is what I’ve done and my suggestions on how to make that plan:
1. Take a notebook and write down on one side of the page the next closest monetary target you want to meet. 
2. Leave that page for a while and on the other side of the paper list all the things you want to buy with that money. If you don’t know how much something you want costs, go and find out and edit the list as required.
3. After you listed all the items, sum it up and see if the number matches what you’ve written on the left side of the page and make the necessary corrections. A lot of times we start with the bizarre figure, but when we make research and calculate, we find out that we actually need much less than we thought.
4.  Now ask yourself the following questions: What can I do now to meet my monetary target?
If you’re working for a company, what can you do to get a pay raise? Can you take on more responsibilities or workload? What can you do for your employer, what benefits can you bring to your company so that they would be happy to reward you? 
Is there anything you can do outside of working hours? Do you have a hobby or a talent or what is it you’re passionate about? What did you always wanted to do for life, but were afraid of?
If you have a special skill beside the office job or if you’re a freelancer or business owner, how can you improve that skill / product and increase your income? Can you do small sample job for free to get your first customers and start word of mouth? What can you do so your existing customers order again from you?
List all the things you can think about below the target on the left side of the page. You might not have an idea how to meet your target straight away. Just remember your target and go on with your day and be sure that an idea will reach you. It might be that you have written a book, but were afraid to show it to anyone or publish it, maybe you could start selling the prints on Etsy or similar web sites if you’re an artist or maybe you’ll just  get a brilliant business idea that will change the world.
5. Keep this page on your desk or in your wallet, review it every day and make necessary additions / corrections.
This plan has helped me tremendously and each time I meet my goal, I take a new piece of paper, put the next target and start working toward it.
Wishing you all the success with your plan and it’s achievement!

Money Management

Money management is one subject they don’t teach us at schools, but isn’t it one of the most important competencies in life? More and more I see people of different ages that caught themselves in the cage of debt, mortgage and credit card bills not because they’re not paid well enough, but all the result of improper budget planning and spending.

From a first glance at the subject, one might think “Well, what is there really to know about money? Just use common sense. Spend less than you earn!” As easy as it may sound, it’s rather difficult to do that when day and night we’re attacked by media and advertisers everywhere and end up spending all our salaries long before the next paycheck arrives. And then there are those who do manage to save some money, but what do they do with it? Store it under a pillow? Put it in a savings account in the bank? How safe and efficient would that be? What currency should you store your money in? So many questions that need an answer.

My parents lived in an era when they were brainwashed to think of money as the root of all evil and spent their life working and hoping that the government would take care of them when they retire. Little did they know that they soon have to adapt to the new circumstances and they couldn’t teach me much about investments and money handling as they didn’t know much themselves at the time.

In the beginning of my career when I started earning my first money, I had to pay different loans and my  salary was very small and I always struggled from not being able to buy all the things I wanted. Once I started earning ‘real money’ I felt the need to compensate for the ‘tough period’ with excessive shopping. I would implement YOLO (you only live once) money strategy and make investments in expensive clothing and accessories and lots of other non profitable assets. It was all fun and games until one day I was laid-off from my job and I had 8 more months to get out of my car loan.

Then I realized that I was living an illusion of stability and continuous income from my job . Reality is that in our unstable world you just can’t depend on only one source of income. I really wished I made proper investments and savings throughout these years, then I would be in a better place financially. What’s done  is done, but I decided to take a whole different approach and educate myself on the subject.

I researched the subject and came to find out different tactics and advice about money management and decided to put together a list of the ones that I found acceptable, easy to follow and test them to see if they really work in real life. So, stay tuned for the future posts with the tips and suggestions.