Welcome to my blog, here you will get all the ideas and information about the personal finance and how you will secure your future with small steps and boost your wealth in better ways. In today’s world, you should have to manage your money wisely as, it is necessary. If you are a beginner than no worry, I am here to guide you and help you out from your financial problems.
You will get a complete guide for – Personal Finance tips for beginners. Just follow the step by step instructions written here in this blog. You will find the complex financial concepts into simple in this blog with actionable tips which fits into your life. You will find the great tips from budgeting and saving to investment and planning for retirement, the main focus of my blog is on helping you thus you can make right decisions to achieve financial freedom
Stay with me and start your finance journey with the expert concepts.
Your wealth, your future, your power.
Power of Budgeting in Personal Finance
Budgeting is one of the most powerful tool which help in controlling personal finance. We usually spent our money on unnecessary things and don’t keep the records of it. At the end of the month, we always question ourselves – Where does my money flies!! Therefore, we should think for upcoming days and spend our expenses wisely.
- You should track your income
Write your monthly income in a page and think that how you’re gonna spend it wisely and how you’re gonna save a certain amount for your future. After tracking your income, start distributing the amounts in various sectors and keep track on it. You must know the details of your income expenses.
2. Expenses should be listed
You should list your expenses in two main types –
- Static Expenses : The expenses which are fixed and remains same each month like rent, installments, loan, insurance, utilities etc. You should keep records of it every month.
- Dynamic Expenses : The expenses which aren’t fixed and constantly changes like groceries, transportation expenses, entertainment, dining out and much more unplanned expenses comes every month which we are unaware of it.
3. Financial Goals set up
You should set up your goals, like what do you want to do after budgeting and working hard. Set your clear goals for example – You want to go for a vacation and your favorite destination is Finland, you have to follow strict rules in your budget. You cannot spend your money in unnecessary things. Therefore, set your goals and go on with your dreams.
Build an Emergency Fund for Personal Finance
Building an emergency fund is essential in today’s life. It secures your financial well-being when the unexpected expenses or crisis comes in unexpected times.
- Set your realistic goals
You must keep track of your essential monthly costs. You should follow proper budgeting system to save your money so that it can cover up to 3 to 6 months of living expenses.
2. Create your separate saving account
You should open a dedicated account for your emergency fund. It prevents you from using the money for non-emergencies. You should consider a high yield saving accounts or also a money market account to earn interest.
3. Start from today
You should stop wasting time on thinking and take action immediately for your better future. You can start saving your money with small amount and increase it over time. Your today’s small steps will help you in your tomorrow’s unexpected disaster.
4. Automate savings
Maybe, you are busy person and you cannot actively manage your emergency fund , therefore you can set automatic transfers from your checking account to your emergency fund. It makes your work easier.
5. Increase your income streams
You should focus more on increasing your income streams like you can find more ways to earn through social medias. You can earn as a freelancer or you can sell your unused items online or you can start your own business such as cloud kitchen and many more, to accelerate your savings.
Smart Investing for Personal Finance
It is all about investing your money with right and well informed decisions that has long term growth with less risks. You should have clear financial goals, such as saving for retirement , buying home, and many other goals. Investing your money in stocks, real estate and bonds helps you to gain a lot of profit. Smart investors focus on long term growth, you should remain patient and committed even when market conditions fluctuate.
- Start investing early
The earlier you begin to invest your money in correct place, you will get good result as your money has to grow through compounding.
2. Diversify
You should spread your investments across various assets such as stocks, bonds, real estates which helps to reduce risk.
3. Risk Management
You should have a gut to tolerate loss. There is high risks in investments but the profit you get is also worthy. You should have patience and don’t risk your money more than you are willing to lose. Furthermore, you should seek for high risk in order to earn high profit from your investments.
4. Avoid the emotional investing
There are always fluctuations going on in the market ,therefore you should always stay calm during the market volatility.
Credit Score Mastery
A credit score is an essential financial tool which reflects your creditworthiness, it also affects your ability to secure loans, mortgages and a good interest rate. If you master your credit score than you can save money and have financial freedom. You can achieve credit score mastery by :
- Understand your credit score
If your credit scores range is from 300 to 850 than –
- Late or missed payments can lower your score.
- You should keep your balances below 30% of your credit limit.
- If your accounts is older than it positively impacts your score.
- If your credit cards are mixed types than it could be beneficial for you.
- If you inquire too much than it can lower your score.
2. Check on your credit report regularly
You should monitor your credit report to spot errors or unauthorized activities. You can also access some free reports annually from the agencies like Experian, TransUnion and Equifax and many other agencies that you like.
3. Paying Bills on time
You should not forget to pay your bills. You can set autopay or set reminder because timely payments are crucial.
4. Reduce your debt smartly
You should first focus on paying off the high-interest debts and do minimum payments on other. This will help reducing your overall debt burden and the ratio of credit utilization.
5. Closing old accounts should be avoided
If your old accounts are unused than you should not close it, it can be beneficial for you. As old accounts contributes to your credit age and it positively affects your score.
6. Check errors on your report
If you found any inaccuracies on your report, than dispute it immediately with the credit bureau as it can cause unnecessary score deductions.
Learn The Art Of Frugal Living
Frugal living is an art where you should prioritize your financial goals and values and minimize unnecessary spendings. The steps which will help you to live fully but in budget are –
- Create a Budget
- Track your income and make a full plan for a month like how you will spend it and how much you will save.
- Invest your money on some profitable things.
2. Reduce your expenses
- You should limit your spendings and avoid dining out or spending in unnecessary products.
- You should cancel unused subscriptions and shops for unnecessary discounts.
3. Minimalism
- You should prioritize your needs over wants.
- Sell your items if you don’t use or you don’t need them.
4. Repair your things
- You should learn to repair things instead of throwing them.
- Engage yourself in DIY projects as it is very useful, you can make handmade gifts, home decors and many other useful stuffs.
5. Thrifting
- If you want to save more money than you can go to thrift store where you can buy used clothes, appliances and other goods in low price compared to other stores.
6. Save on Utilities
- You should save the energy. You should limit the use of electronic appliances and conserve water. It helps you to save your money more efficiently.
7. Mindset
- You should build a savings mindset and set financial goals.
Stay Updated On Financial Trends
You should follow financial new outlets and regularly check platforms where you will get to know about the market updates and trends.
If you want to know the real time data and news than these apps are useful –
- Yahoo Finance
- Google Finance
- Investing.com
You can sign up for trusted newsletters from financial websites. You can also get finance related news and reports in social media like Twitter, LinkedIn, Instagram and more.
Google Trends is most helpful to discover the trending financial topics globally. You can also participate in forums like Reddit or Facebook groups.
You will find everything about finance in social platforms.