Money management is probably the hardest habit to adopt for most families. However, there are simple tips that would help you and your entire family manage your finances prudently. Try these seven money management tips and you will be in charge of your budget.
1. Buy from Thrift or Discount Stores
Consider buying your clothing from thrift stores. They sell barely used clothes for up to quarter the price of the original price.
If you don’t like thrift stores, then visit discount stores for available offers on items. These stores often give significant percentage discounts on items.
2. Avoid Off-the-Shelf Buying
Each time you want to buy costly items, such as electronics, surf the Net for the lowest prices. Check the manufacture’s website for available coupons. Several online stores also provide products and services on coupon basis. You can always get up to 80-percentage discount on items during a clearance sale in these stores.
3. Avoid being Over-Insured
It is impossible to insure yourself and family against every potential risk, you can go bankrupt trying. Any insurance coverage must match the reasonable possibility of a negative outcome for which you took the policy. For example, if you earn $40,000 annually, you will not need a $1 million life insurance.
4. Plan to Buy When everyone is selling
It is typical for retail prices to fall significantly in January. Therefore, do the bulk of your buying in January rather than November or December.
You can also buy winter clothing in early spring or late winter when winter items are on clearance sale.
5. Avoid Credit Cards
You should avoid paying for shopping and services using a credit card. Instead, use cash or debit cards. Credit card companies charge a fee that would make your shopping very expensive in the end.
6. Gift Time to Loved Ones
Avoid buying expensive gifts for your loved ones during birthdays or holidays. Instead, consider spending quality time with them if that would be less expensive.
7. Save at least 20 percentage of Your Net Income
You need to save a minimum of 20 percentage of your net income. When your bank account is well stocked, you will have several options, which is what you need to take care of your family.
Nothing is as reassuring as financial freedom. These seven tips are simple yet very powerful if put into practice. They will go a long way to help you reduce unwanted spending, reduce unnecessary debts and help you and your family become responsible financially.