Personal finance - put money away for a rainy day
If we have learned anything from the way the economy has nose dived, it's the fact that we have to learn to stop living beyond our means and that we should all have some money put away in savings for the "rainy day" that we just know will show up at some point. Now, more than ever, people are realizing that taking charge of their personal finance issues must be done.
Many people were caught flat footed when the bottom fell out. They lost their jobs and didn't have any type of backup plan. Without a reserve and with so much debt many people lost everything they had. Not much of a reward for years of hard work, is it? But whether we want to admit it or not, we are responsible to a large degree.
A lot of us have turned away from the ideas of our parents and their reluctance to have any debt at all. They felt that if they couldn't pay cash for something, they couldn't afford it and they didn't get it. Today it is way to easy to just whip out a credit card, and many of us have thrown common sense right out the window in the process.
But it is not too late to make changes when it comes to personal finance you can start today to take control and hopefully be better prepared the next time the economy decides to head south.
Here are some easy things you can do to take charge:
1. First of all, you need to get a handle on your budget; how much money you have coming in and how much money you have going out. When you take the time to sit down and write it all out (or use a software program) you may just be shocked at how uneven it is. Many of us are stunned to see that we are regularly spending more than we are earning. Getting it all in black and white can be very sobering.
2. Make sure you set aside a certain amount every paycheck for savings. It doesn't have to be a lot but when you make out your budget include a certain amount to go directly into your savings account. Many employers will allow you to do that automatically. You can often sign up for direct deposit and have most of your check go into your checking account and a smaller amount go directly into a savings account. That way you are sure it will get into savings.
3. Get rid of the debt. Once you've got your budget set up take a little extra every month and put it towards paying off some debt. Start with your smallest debt first, just apply a little extra every month. When that debt is paid off you can take the amount of money that you were paying on that and apply it to your next smallest debt. Keep repeating this cycle until all of your debt is paid off. Once you are debt free, stay that way.
This is the way to keep your personal finance situation on solid footing.
Karen Ensam writes for Real Estate in Italy, an interesting investment opportunity.
Article Source: Messaggiamo.Com
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