Living Within Your Limits– A Little Frugal Personal Finance Advice
Many people are in difficult straits when it comes to their personal finances. Increasing your income is often an unrealistic solution, especially given the condition of the world economy these days. Many times, the smartest way to handle your money is by learning to live more frugally. Minimizing your expenses and making smart financial choices can really ease the financial pressures you experience.
The first way to get your income and expenditures living in harmony is to put them side-by-side. Yes, it’s time for you to draw up the dreaded budget! The most important thing for you to do is look at where your income is going to go each month. Try looking at each monthly expense you have in terms of the fraction of your income it requires. Fractions that seem excessive can help you pinpoint areas where you’re spending too much.
The next thing you can do to make the ratio between the money you take in and the money you spend look healthier is simply to spend less. There are a lot of ways you can save money without giving up the creature comforts that are near and dear to you. Look for cheaper sources for the essentials. Buy in bulk where possible; buy second-hand whenever top quality is not essential. (Hint: It almost never is!) Sometimes finding a lower price feels a lot better than cutting an expense entirely.
Hopefully, pulling your monthly budget into balance and saving some money on your expenses will give you a little spare cash at the end of the month. Resist the urge to splurge with this new-found windfall! One of the most important financial habits to cultivate is saving money. You should be socking a little something away every month, or even investing money if your surplus grows large. No matter how modest the monthly contribution you can afford to make, it will build up quickly to provide you with a decent safety net.
One investment that you should make, regardless of your income, is in debt reduction. Debt is never a good thing! Sometimes it is unavoidable, but it’s never actually positive. Your individual situation will determine whether or not debt reduction should be a higher priority for you than savings. Just remember that as long as you are paying interest on your debts, you are basically wasting money; getting rid of them can be like getting a raise!
Once you have your personal finances on an even keel, you should really give a thought to helping out others. Charity is a powerful tool; devoting a little of your money to helping the less fortunate is a great idea. It makes you feel better, of course, and it has a palpable, positive impact on your community. Where you choose to direct your charitable donations makes little difference. There are people in need on the other side of the world and right across town. When you do your part to help them out, you take responsibility for more than just your own needs.
Hopefully, this advice has given you a few ideas for ways to modify your personal finances. If you find these suggestions helpful, remember that there is plenty of other great information on frugal living available out there. A little research can help you keep your expenses low and focus on the most important things to spend money on.